1921-04-05

[Stage Direction]
Bill No. 48 (from the Senate), for the relief of William John Bell.-Mr. Tudhope.
Bill No. 58 (from the Senate), for the relief of Hazel Galbraith.-Mr. Douglas (Strathcona).

[Stage Direction]
On the Orders of the Day:
Hon. W. L. MACKENZIE KING (leader of the Opposition) :: I should like to ask my hon. friend the Minister of Finance if he is yet in a position to give the House any information as to when he intends to present his Budget.


Sir HENRY DRAYTON (Minister of Finance) :: I am afraid that I cannot give
my hon. friend any definite date. But progress is being made, and we are getting nearer to the Budget every day.


William Lyon Mackenzie King: Can my hon. friend give an approximate date-a week, two weeks, a month?


Henry Lumley Drayton: I should hesitate to give even an approximate date, for I should not like to disappoint the House.



GRIFFENHAGEN AND ASSOCIATES

[Stage Direction]
On the Orders of the Day:
Hon. CHARLES MURPHY (Russell) :: May I inquire from the leader of the Government if any person in any way connected with Griffenhagen and Associates is still in the employ of the Government, and if so, what work such person or persons are doing, and under what authority?


Right Hon.   S@: In
answer to my hon. friend I would say that the contract, as per notice, has been cancelled, but the work of organization a part of which remains unfinished will still be carried on by the subcommittee of Council with the aid of certain persons employed from that company.


Charles Murphy: How many of them are
still employed?


Sir GEORGE FOSTER:: Not many. I
could not tell my hon. friend the exact number at the moment, but I will find out and let him know, probably to-morrow.



ANSWER TO INQUIRY FOR RETURN

[Stage Direction]
On the Orders of the Day:
Right Hon. ARTHUR MEIGHEN (Prime Minister) :: In answer to the hon. member for Kent, N.B. (Mr. Leger) who inquired yesterday as to the progress of a return ordered by the House on March 14, I may say that the delay in bringing it down occurs by reason of the way the notice of motion for production of papers was framed, it being worded by the hon. member in the general form which, I venture to suggest is too often used, and which compels inquiry to be made of, and reply awaited from, every department of the Government. If hon. members would confine notices of motion to cover only the department they have in mind, they would get returns more rapidly. This particular return really covers the Department of Indian Affairs, but being general in its form inquiries had to be made of all departments. The answer from the Department of Indian Affairs went to the Secretary of State some

time ago, and consequently it will only be a short time until the return is brought down.



BUILDING TRADES' CONFERENCE

[Stage Direction]
On the Orders of the Day:
Arthur Meighen: In answer to the hon. member for Russell (Mr. Murphy), who inquired yesterday whether the Government intended to defray the expenses of the delegates who will attend the Building Trades' Conference, I am informed by the hon. the Minister of Labour that it is the intention to make the same allowances as were made to the delegates to the Industrial Conference of 1919.



GRAND TRUNK RAILWAY-ALLEGED DEFAULT OF INTEREST

[Stage Direction]
On the Orders of the Day:
Arthur Meighen: I desire to refer to an inquiry made yesterday by the hon. member for Cape Breton North and Victoria (Mr. McKenzie) with regard to the reported default of the Grand Trunk Railway on certain securities interest on which fell due April 1.
The House will no doubt remember that the Act embodying an agreement which passed this Parliament calling for an arbritation tribunal to determine the value, if any, of the three preference and common stocks of the Grand Trunk Railway provided that the arbitration tribunal should have nine months from the date of the appointment of the arbitrators within which to secure evidence and make their award, such nine months being capable of extension by approval of the Governor in Council. The provisions of the agreement also called for the Grand Trunk Directors remaining in possession pending the result of the arbitration and the making of the award, a committee of management being established in the meantime with certain limited powers. Owing to the heavy demands made upon the Government for financing the road while the Grand Trunk thus remained in possession, owing as well to what we believed to be dilatory methods of preparing for, if not conducting, the arbitration, the Government felt that there should not be further financing except what we might be under legal obligation to pay or a further extension of time, involving as it probably would, still further

financing with the Grand Trunk in control, unless the time contemplated by the original agreement for the transfer of possession and control should be adhered to notwithstanding any extension.
An intimation of the Government's position was made to the Grand Trunk Railway a very considerable time ago. Up to the present, arrangements for that transfer have not been made. As a consequence there has not been further financing by the Government since the final intimation of our position was made. That may have something to do with the reported default on April 1. I have only to add that the Government has as yet no official intimation that the Grand Trunk did default, but inasmuch as a statement did come from the President that they would not be in a position to pay, it is not improbable that the report is correct.



CASE OF SMALLPOX ON THE SCANDINAVIAN

Hon. J. A. CALDER (Minister of Immigration and Colonization):: A question was asked yesterday by the hon. member for Assiniboia (Mr. Gould), concerning a case of smallpox that had broken out on a steamship arriving at the port of St. John a short time ago. I have received a statement from the department in connection with that inquiry which is as follows-
The original ease developed the fourth day out from Antwerp, March 19th. The patient was at once isolated ; so were two immediate contacts occupying the same room. Then everyone on the boa t was vaccinated. No other case developed on the voyage.
During the period of incubation there is no risk in the way of general transmission. In the present case the incubates would have developed only after landing.
Only a few Anglo-Saxon passengers shipped at Antwerp. These had their cabins on the upper deck (B), with those who embarked at Southampton later. The Continental Antwerp passengers occupied (C) deck below. We know for a fact that the upper deck passengers used a different dining room, parlour and living room from the Continental. The only common place of meeting was the upper after deck from the promenade, which was very little used by passengers detained, thus reducing the possibilities of contamination to a minimum.
The Health Department considers that no unjustified risk was taken in making the separation that was made.
Mr. OSMONDE GRATTAN ESMONDE


Mr. S. W. JACOBS (George Etienne Cartier):: A Vancouver despatch this
morning announces that Mr. Osmonde Grattan Esmonde has been arrested on orders from the mayor of Vancouver for alleged sedition. The despatch goes on to

say that the case will probably be disposed of by the Immigration Board. Has the Minister of Immigration any information to offer the House regarding this matter?


James Alexander Calder: I have no
information whatever; I was not aware of the fact that Mr. Esmonde had been in Vancouver.


Samuel William Jacobs: Will the minister make
inquiries?


James Alexander Calder: I will, yes.



THE CANADA WEST INDIES TRADE AGREEMENT, 1920

[Stage Direction]
On motion of Right Hon. Sir George Foster, (Minister of Trade and Commerce) the House went into Committee to consider the following proposed resolution, Mr. Boivin in the Chair:
Resolved, (1) That it is expedient to approve the agreement dated the eighteenth day of June, 1920, between the Government of the Dominion of Canada and the Governments of certain of His Majesty's colonies in the West Indies, which agreement is termed ''The Canada West Indies Trade Agreement, 1920";
(2)	That the provisions in the said agreement relating to the customs duties upon goods, the produce or manufacture of any of the colonies, the government of which is a party to the said agreement, be sanctioned and declared to have the force of law in Canada;
(3)	That the Governor in Council shall have power to prescribe, by proclamation published in the Canada Gazette, the day upon which the preferential treatment of the said goods provided for in the said agreement shall be brought into force under the terms of the agreement wi-th respect to each of the said colonies, the extent of such preference within the limits prescribed by the said agreement where the exact amount thereof is not specified in the said agreement, and the day upon which the preferential treatment of the said goods of any of the said colonies is terminated under the said agreement;
(4)	That the Customs Tariff, 1907, and the amendments thereto be amended in accordance with the provisions of the said agreement; and
(5)	That the Act to be based upon these resolutions shall come into force on a day to be fixed by proclamation of the Governor in Council published in the Canada Gazette.
Mr. FIELDING:: Is this agreement to
be found in the Votes and Proceedings?


George Green Foster: It was laid
on the Table some time ago. I will also have placed in the boxes of hon. members copies of the report of the proceedings of the conference, of which this agreement is the result. The resolution pretty well explains itself, and I would rather take the discussion of the subject on moving the second reading of the Bill. I should like to get the matter advanced to that stage, but
if there are any questions which hon. members desire to ask, I shall be glad to answer them.


William Stevens Fielding: Does the right hon.
gentleman propose to introduce the Bill immediately?


George Green Foster: Yes.


William Stevens Fielding: And deal with the
matter in Committee at a later stage?


George Green Foster: Yes.


William Stevens Fielding: That is reasonable.


Mr. LEMIEUX:: Has my hon. friend
received any petition from the tobacco growers in connection with this Treaty?


George Green Foster: I do not remember having received any.
Resolution reported and concurred in. Sir George Foster thereupon moved for leave to introduce Bill No. 59 respecting the Canada West Indies Trade Agreement, 1920.
Motion agreed to and Bill read the first time.



FRENCH TREATY

[Stage Direction]
On motion by Right Hon. Sir George Foster (Minister of Trade and Commerce) , the House went into committee to_ consider the following proposed resolution, Mr. Boivin in the Chair:
Resolved, (1) That it is expedient to approve the provisions of the Trade Agreement made between the Government of the French Republic and the Government of Canada, dated at Paris the twenty-ninth day of January, 1921.
(2) That the Governor in Council may make such orders and regulations as are deemed necessary to carry out the provisions of the said agreement, and such orders and regulations may be varied or revoked, and they shall be laid before both Houses of Parliament as soon as may be after they are made.
George Green Foster: I would like to make the same remarks with reference to this resolution that I made with regard to the other: we will take the discussion of the matter on the second reading of the Bill. The agreement has been laid on the Table and has been printed-at least the order has been given for the printing-and if the resolution passes I will introduce the Bill founded upon it which also is printed.


Rodolphe Lemieux: May I ask my right hon. friend, who has returned but lately from France, if, during his interview with the French Government and especially with the Minister of Trade in France, mention was made of the exhibition train which will

be sent throughout Canada, from ocean to ocean, this spring? My right hon. friend knows that the Chamber of Commerce in France have made certain arrangements with the railway companies in Canada, and the harbour authorities in Montreal especially, with a view to sending some of the French commercial exhibits throughout the Dominion, provided that Canada makes a similar exhibition in France at a later period. My right hon. friend will know what I am referrng to; I think he has had some conversation on this matter with Senator Beaubien. When I was reading about my right hon. friend's discussion with the French Government, my attention was called to some speeches delivered in Paris and some articles published in the press over there, to the effect that as a result of this treaty this arrangement would be put into effect and would be conducive to more extended trade relations between the two countries.


George Green Foster: The proposition to which my hon. friend refers was one placed before the merchants of France and some officers of some of the departments of government there, long before the negotiation of this agreement and did not necessarily-and did not as a matter of fact-come up when we were talking with reference to this treaty. That -was a matter along the line of commercial development which is not based upon the treaty, so to speak. But, so far as my knowledge goes now, the arrangements are pretty well completed for an exhibition train, furnished with samples of French merchandise, to make a tour of our country -going from city to city and stopping for a little time in each, the exhibits being upon cars of the train and remaining there, and advantage being taken at the same time for film representations, more or less extended, of not only the exhibits which are being shown but of French productions and French scenery. The films are said to be of a most excellent quality, and some samples that I have seen fully bear out that statement. In return for that we give certain facilities, in fact all the facilities that we possibly can. The railroads do the hauling and provide the cars and, practically, the Dominion of Canada, as a government, has no expense in the matter. The French Government and authorities, in their turn, undertake to facilitate a similar train being carried through France fitted out with exhibits from Canadian producers, industrial and otherwise, and to give to that train and those exhibi-

tors the same facilities and courtesies that are extended to the French train in Canada.


William Stevens Fielding: I concur in the view expressed by my right hon. friend that the details of this matter may be better considered when we have the Bill before us in Committee of the Whole, and therefore I do not rise to offer any objection to that course. But I want to call my right hon. friend's attention to a somewhat queer "scrap of paper" which he has circulated, and which purports to be an agreement. The only information which we have at the present time on this subject is that "scrap of paper." It is headed "An Act respecting a certain Trade Agreement between His Majesty and the President of the French Republic." Yet it is not in the form of an Act, and there is nothing in it to show that it is intended to be an Act, but it goes on to state that it is a trade agreement between France and Canada. It not only does not seem to be in the form of a treaty but is entirely lacking in all the characteristics of one. I cannot imagine that this is a complete copy of the document. If this is the actual and complete agreement as it has been arranged between the Government of Canada and the Government of France its presentation in such a form is a very unusual proceeding. I only call my right hon. friend's attention to the fact now in order that before he brings in the Bill we shall be supplied with information in proper form, and shall have an exact copy of the treaty, or agreement, and not merely a "scrap of paper" which is evidently not complete.


George Green Foster: The agreement itself has already been laid on the Table, as I informed the committee a moment ago, and is being, or has been printed; it is either now distributed, or will be immediately distributed, to hon. gentlemen. We are now dealing with the resolution and my hon. friend assents to its being passed. A Bill, founded on the resolution, will be introduced which, on being passed by the House, becomes the Act governing this matter.


Mr. CLARK (Red Deer) :: Has the whispering now going on any reference to the trade question?


Some hon. MEMBERS:: Hear, hear.


George Green Foster: My hon. friend must have seen the agreement itself because it has been placed on the Table. I have not drafted the Bill-which is to be

founded upon this resolution; that duty has been performed by the officers of Parliament.


William Stevens Fielding: I have seen the only information on the subject, as far as I know, that my right hon. friend has caused to be laid on the Table. What I hold in my hand is apparently a copy of what was laid on the Table and that, I repeat, is headed "An Act respecting a certain Trade Agreement between His Majesty and the President of the French Republic." It is not in the form of an Act, there is no reference to His Majesty in it from beginning to end, and it is clearly lacking in all the characteristics of an agreement. In substance the information may be there, but in documents of this character we do not want merely the substance-we want complete copies, and no complete copy of this agreement I am satisfied has been laid on the Table.


George Green Foster: There is a
great difference of opinion then between my hon. friend and myself because I certainly gave the agreement to the Prime Minister, and I think he laid on the Table the whole of the official documents.


William Stevens Fielding: Well, here is a document which was laid on the Table. If my hon. friend has any other I would be happy to see it; I do not know of any other. This appears to be an agreement, I suppose it is fair to say that in substance it is an agreement; but in documents of this character, which are necessarily of a formal nature, we should have a copy of the actual agreement itself.


Arthur Meighen: I see the point raised by the Jion. gentleman. It has not the form of an Act, and it would appear to me as if something had been omitted by the parliamentary counsel; nor when he purports to describe an agreement, does the opening recital look to me as if it was really the beginning of the agreement. I will have both matters looked into by the parliamentary counsel, but doubtless the substance of the agreement is there.
Resolutions reported.



JUDGES ACT AMENDMENT

[Stage Direction]
On motion of Right Hon. C. J. Doherty (Minister of Justice) the House went into committee to consider the following proposed resolution, Mr. Boivin in the Chair:
That it is expedient to provide,-
1.	That the provisions of section eleven of chapter fifty-six of the statutes of 1920, entitled
An Act to amend the Judges Act, withdrawing the exemption of certain judges from the operation of certain taxes, shall not apply to the present Chief Justice of Canada.
2.	That an additional judge of the Court of King's Bench for the province of Saskatchewan be appointed at an annual salary of nine thousand dollars.
3.	That paragraph (b) of section eighteen of the Judges Act be repealed and in lieu thereof provisions he enacted as to when certain judges of the Supreme or Superior Courts of the province of Nova Scotia, New Brunswick, Manitoba, British Columbia, Prince Edward Island, Saskatchewan and Alberta are not to be paid travelling allowances for attending court or chambers.
William Lyon Mackenzie King: Explain,
please.


Mr. DOHERTY:: Mr. Chairman, I will
try to explain this resolution so far as it calls for explanation. The reason why it is essential that the Bill proposed to be introduced be preceded by a resolution is that it provides for the salary of an additional judge in the province of Saskatchewan. The legislature of that province has increased the number of its judges in the court of King's Bench by one. The purpose of one of the clauses of the Bill is to make provision for the salary of that additional judge. There are two other clauses. One of them is to correct an error. In the legislation for the increases made last year in the judges' salaries, provision was made that all judges whose salaries were increased by that measure should, both as to their salaries and as to any retiring allowances they might later be entitled to, become subject to the payment of income tax. The fact was overlooked that the salary of the chief justice of the Supreme Court, though in words it appeared perhaps to be increased, was not in reality increased. Prior to that legislation the salary of the chief justice of the Supreme Court was fixed at $10,000, and he was voted annually an allowance of $5,000 as remuneration for the performance of his duties as Deputy Governor General. By the legislation of last year the salary was made $15,000, but it was provided that it should cover not only the performance of his duties as chief justice but of his duties as Deputy Governor General. So as a matter of fact no increase whatever was made in the actual remuneration. It was therefore considered unfair, and I think I am safe in saying that it was not intended, that, receiving no increase, he should be made liable to the payment of income tax. It is proposed to rectify that error. The third clause has to do with the payment of travelling allowances to judges in the

provinces mentioned. It is to correct an abuse that has grown up, resulting from the fact that in those provinces the place of residence of the judges are not fixed by provincial law, so that in the past they apparently have considered themselves- and I think they could not be criticised for that-entitled to reside wherever they chose. That, of course, does not concern this Government or this Parliament, save in so far as it affects the amount allowed for travelling allowances. Thie purpose of this clause is to provide that judges who under provincial legislation are free to fix their places of residence where they please, shall not be entitled to travelling allowances for attending court at the centres where the proper seat of their court is.


Mr. EDWARDS:: If I understand the
minister correctly, we are informed by him that the second part of the resolution is to provide that a judge who does not travel is not in future to receive anything for travelling expenses. That is a wonderful piece of legislation; it is really remarkable; if it means that in the past we have been paying judges certain amounts of money for travelling expenses when they did not travel, then it is certainly time the abuse was rectified. We had an oustanding case some time ago where a chief justice did pull down some $5,000 for travelling expenses when he did not travel. That amount of money we received back after considerable trouble and after considerable wriggling on the part of that particular chief justice. It was nevertheless a reflection upon the common sense of this House that the payment ever was permitted. I want to enter my protest, Mr. Chairman, as a member of this House against the first part of that clause exempting the chief justice of Canada, who is in receipt of a salary of $15,000 from payment of income tax.


An hon. MEMBER:: He is too poor.


William Cameron Edwards: I venture to say that if you will fly in the face of public opinion to the extent of increasing the sessional indemnity of hon. members to $15,000, we will all be willing to pay income tax on that amount. Why in the name of reason is the chief justice of Canada to be exempted from paying income tax on his salary of $15,000?


An hon. MEMBER:: Shame.


William Cameron Edwards: I am only a layman, but for the life of me I cannot see any

rhyme or reason in any proposal of this kind. The minister says that really no increase was made to the salary, that the $5,000 was added to the $10,000 salary of the chief justice to cover his expenses for acting as Deputy Governor General of Canada. Was anything more ridiculous ever uttered on the floor of this Parliament? Let us have done with this subterfuge and camouflage. Every hon. gentleman knows that it does not cost the Chief Justice of Canada $5,000, or $500, to come to this Parliament now and then to act for the Governor General. It does not cost him $5,000, or $500, occasionally to write his name on a document as Acting Governor General. The thing is absolutely ridiculous. If you want'the salary of the Chief Justice of Canada to be a certain sum, fix it at that sum and be done with it. The principle is unsound, Mr. Chairman; a man who receives a salary of $15,000 a year should not be exempt from income tax. I for one will vote against this motion.


Charles Joseph Doherty: I very much regret that notwithstanding my effort to speak both loudly and clearly, I should have conveyed to the hon. member the impression that this resolution proposes to do something which it does not propose to do and something with which it has nothing to do. In certain provinces, owing to the fact that the law did not fix the places at which the judges should reside, the judges found themselves free to choose their own places of residence. Under the existing legislation, which had in view the provinces in which the places of residence were fixed by law, provision was made for travelling allowances when a judge attended court elsewhere than at his actual or legally fixed residence. Our attention was called to the faft that in certain of these provinces where there was not a legally fixed residence the judge selected his residence and charged travelling allowance when he travelled from that selected residence to the chief cities where the sittings of the court were held. We did not and we do not think it is right that there should be a travelling allowance under. these circumstances. If a judge in the exercise of his own free will chooses to reside elsewhere than at the principal city where his work is, we think he should not have travelling allowances-and the purpose of this measure is to provide accordingly- except, of course, in cases where by law he is compelled to reside in some place

other than the chief centre where the sittings of the court are regularly held.
Now, with regard to the Chief Justice, this is not a provision to introduce a system under which the salary of the Chief Justice shall be exempt from income tax. Wisely or unwisely, the legislators of the past provided that the salaries of the judges should be exempt from taxation. That was the law under which the present Chief Justice and all judges prior to the legislation of recent years were appointed; they were to have a certain salary and they were to be exempt from taxation. Now, it is one of the fundamental principles of the British constitution that the independence of the judges must be made as certain as possible, and it has been universally recognized that in order to accomplish that, their remuneration should not be subject to reduction at the pleasure of the Government or of Parliament. The salaries of all judges other than the Chief Justice of the Supreme Court were increased last year and it was considered right as a condition of that increase to remove the exemption and to subject their salaries to taxation. But the reason for removing the exemption did not exist in the case of the Chief Justice because his remuneration remained the same as before, only that previously it was divided into two sums, one of $10,000, his salary as Chief Justice, and one of $5,000, his salary or remuneration as Deputy Governor General. That $5,000 was not in the nature of an allowance to pay expenses.


William Cameron Edwards: What if he goes overseas to attend the sittings of the Privy Council?


Charles Joseph Doherty: The law at present makes a provision of $3,000 for any qualified judge who sits on the Privy Council. The present Chief Justice has never sat in the Privy Council.


Rodolphe Lemieux: Who does?


Charles Joseph Doherty: Last year, and, I think, the previous year, Mr. Justice Duff did. But that has nothing to do with a question of allowance for expenses.


Rodolphe Lemieux: Who selects the judge who sits on the Privy Council?


Charles Joseph Doherty: Well, it is subject to the approval of the Governor in Council.


Rodolphe Lemieux: Has the Chief Justice anything to say in the matter?


Charles Joseph Doherty: There is no law defining how it ought to be done, but as a matter
of propriety certainly the Chief Justice should be consulted. So far as I am concerned in the matter I certainly would consult with him before coming to any conclusion.


Mr. CANNON:: The person who sits on the Privy Council has to be a Privy Councillor as well as a judge, has he not?


Charles Joseph Doherty: Yes. Any member of the Imperial Privy Council who is or has been a judge of a High Court in any of the dominions is eligible to sit on the Judicial Committee of the Privy Council.


Rodolphe Lemieux: When was Mr. Justice Duff made a Privy Councillor?


Charles Joseph Doherty: I cannot recall the precise date, but I think it was two years ago. I would like to make this quite clear, if I may. This is not a question of allowance for expenses at all; the Chief Justice has had this salary or remuneration for acting as deputy Governor General for years back and the legislation of last year, therefore, left him absolutely where he was. If this legislation should not now be passed, you would have this anomalous situation, that the legislation of last year, intended to increase the judges' salaries operated to reduce the remuneration of the actual Chief Justice, and had no other effect as regards him.


Mr. McLEAN (Royal):: I am sorry I cannot understand the perhaps very clear explanation made by the Minister of Justice (Mr. Doherty). Sometimes in the past it has been difficult for me to follow him on account of his speaking very low, and it is difficult for members to hear clearly what he states. What I understand the Minister of Justice to state is this. This measure is to remedy a hardship on the part of the learned Chief Justice of the Supreme Court of Canada. What we members, who object to this resolution, object to, is the principle that is established that the Chief Justice shall not pay income tax. That is a bad principle to go out to the country. Under the law as it stands at present, every man in Canada is liable to pay income tax; that is the principle that stands and that should be enforced, and the Minister of Justice has no right to make an exception. If, as stated by my hon. friend (Mr. Edwards), you want to increase the salary of the Chief Justice, increase his salary. But is this not true? The salary of the Chief Justice is raised to $15,000; is he not now entitled to retir* on $15,000?


Charles Joseph Doherty: No, because in that same legislation it was provided, in the first place, that all judges appointed in the future should be liable to pay income tax; second, that with regard to all judges of the Higher Court appointed in future, the provisions enabling them to retire on full salary should be repealed, and that as regards all existing judges, in fixing the amount of their retiring allowance, where they were entitled to their full salary, the increase of last year should not be taken into account. So that the position of the actual Chief Justice of the Supreme Court is this: As long as he remains on the bench, he will receive absolutely the same remuneration that he received before the legislation of last year. If he comes to retire, having fulfilled the conditions which, under the past law, entitled a judge to retire with his full salary, he will retire with that full salary, not as it is created by the legislation of last year, but as it stood before that legislation, that is to say, with a retiring allowance of $10,000.
The hon. gentleman asked one other question. He asked-Was this laying down the principle that the Chief Justice of Canada should be exempt from taxation? It is not. The principle that has been laid down for the future is that the salaries of all judges appointed hereafter shall be liable to taxation. As regards existing judges, the salaries of all
4 p.m. judges whose salaries were increased by last year's legislation, shall be liable to income tax. But as regards those judges whose salaries were not increased, we were bound by the contract which was made with them when they were appointed and under which their remuneration was to be exempt from taxation. We took occasion of the increase made to make, as a condition of the increase in salary, the withdrawal of the exemption to which judges were otherwise entitled. In doing that, however, we withdrew from one man, who got no increase at all, the privilege to which he was entitled under his appointment, and we could not justify our action in that regard as being hte condition of an increase in remuneration.


Hugh Havelock McLean: I thank the learned Minister of Justice for his lengthy and perhaps not very clear explanation, because I am still in a little doubt in comprehending all he says. What I understand him to say is this. We are making this poor man suffer by increasing his sal-
ary by $5,000. That is unfortunate. Before that he received $5,000 for the onerous duty of acting as deputy Governor General. Very good. The learned Minister of Justice has not brought before our attention this matter: that all the other judges were allowed extra remuneration for extra work when they served on Royal commissions. They were often taken off the bench and appointed on Royal commissions and on other special work for which they received extra remuneration. It is now put into the Judges' Act that the increase of salaries shall cover all extra work that judges may perform; that they shall not receive one dollar more for extra work, which they may perform on Royal commissions or other work. Are they not then on the same ground or standing as the Chief Justice? They are prevented from earning this extra remuneration. The learned Chief Justice is prevented from earning this extra remuneration. But to come back again, this is the principle on which I want to stand. I have no objection to the salary of the learned Chief Justice being increased. The position should carry an ample salary to command the highest legal talent in this Dominion, and $15,000 is too small a salary for the Chief Justice of Canada. Why, you are paying to counsel, retainers of $20,000 and so many hundred dollars a day. If you go to Montreal at the present time, you cannot obtain a leading counsel under $10,000 or $12,000. So I say, I am not objecting to the salary being increased; I am objecting to this roundabout way of doing the thing. It is not the right way of carrying out the increase in the Chief Justice's salary. I think the salary of the Chief Justice of this Dominion should be $20,000.


William Cameron Edwards: I may have misread into the resolution something that was not intended.


Mr. McMASTER:: Louder.


William Cameron Edwards: My hon. friend should consult a specialist down town with regard to his hearing. If I have misread or misinterpreted the resolution prepared by the Minister of Justice (Mr. Doherty), some members in the House will, I am sure, be good enough to excuse me to a certain extent. It is not always easy to arrive at a conclusion after a resolution has been prepared or a sentence uttered by the Minister of Justice. It is unquestionably my fault or my misfortune, that I have not had that legal training to enable me to follow, if I may speak without offence, the twists and turnings of a legal mind.


Andrew Ross McMaster: Order, order.


William Cameron Edwards: I had no reference to
the hon. member for Brome when I used that expression. Now, Mr. Chairman, even if I did come to the conclusion that some members of the bench were receiving travelling expenses when they did not travel, am I to be blamed for coming to that conclusion? I do not have to remind the Minister of Justice of the very outstanding instance in this country where a certain legal gentleman collected money for travelling expenses when he did not travel, and that there were certain gentlemen connected more or less closely with the law in this country who were prepared to excuse that action on the part of the Chief Justice of the Dominion of Canada. I am one who will not excuse him. The Lord defend me from the legal quibbles and technicalities that we have handed out to us here on the floor of this House.
The Minister of Justice says that when the salary was fixed at $15,000 there was no increase made in the salary of the Chief Justice. I say that in my estimation, and I believe this was also in the minds of other hon. members of this House, there was an increase made in his salary when it was fixed at $15,000. It was in my mind, and I believe in the minds of many hon. members, that he was not earning the $5,000 he got for coming down here once in a while and acting on behalf of the Governor General

that he was not earning $5,000, nor $4,000, nor $3,000, nor $2,000, in doing that;-and when it was agreed to fix the salary at $15,000, that was taken into account, and it was considered that we were giving him a definite, and a pretty substantial, increase in salary. That is the way I viewed it, at all events; I considered that it was an increase. Formerly, his salary was $10,000. The other was, of course, a little side line that gave him another $5,000, but we made the thing definite and fixed his salary at $15,000.
We hear a good deal about the independence of the judiciary, that it is necessary to fix their salaries at a certain figure in order that they may keep their honour above reproach, and all that sort of thing; we have heard that time and again. So, when the salary of the Chief Justice of Canada was $10,000, in order that he might not be subjected to any temptation to stray from the path of virtue, we gave him another $5,000 for trotting down here once in a while and signing his name when the Governor General was absent. Then
in order to shield him still further from temptation and keep him in the path of rectitude, we gave him another $5,000 to trot over to England once in a while to attend the sittings of the Privy Council. But all that did not prevent a Chief Justice from collaring the money even though he did not go overseas. What was wrong? There was no income tax at that time to lead him away from the path of virtue-Were we remiss in not fixing his salary at $100,000 so that he would not feel like pocketing $5,000 that he did not earn? Something was wrong. He took money that he was not entitled to, that he had never earned. Even though he was the Chief Justice of this Dominion, I repeat, he took money that he never earned and was not entitled to. If we are to fix their salaries at the point where, like Caesar's wife, they will be above suspicion, we have never yet reached that point, apparently.
The principle of the thing is wrong in my estimation. We have our income tax. We have a man who is supposed to be something superior in intelligence dropped down from Heaven to this earth to make regulations in regard to the collection of income tax in this country. We have regulations now which make every man in this country who is liable to income tax, and even if he is not liable, his own assessor and his own collector, and he is liable to a fine, if he makes a mistake in assessing himSelf. That applies to people who are above the $2,000 mark, if married, and above $1,000, if single. But you must not touch the man drawing $15,000 because it was not in the Act that his salary was raised. Well, if that was not included in the Act, I submit that the proper procedure is to bring in a Bill to amend the Act and fix it up right instead of following this roundabout way. I object to any man in this country who is drawing a salary of $15,000 getting out of paying income tax; I do not care if he is the Chief Justice of Canada or who he is.


Sir ROBERT BORDEN:: Mr. Chairman, I could perhaps put this matter before my hon. friend from Frontenac (Mr. Edwards) from a layman's point of view. The position before the legislation of last session was this, as I understand it, and I am following in this regard the statement which has just been made by the Minister of Justice. Each of the puisne judges of the Supreme Court of Canada received a salary of $9,000. The Chief Justice of the Supreme Court of Canada received a salary of $10,000. As Chief-

Justice he was called upon, under the constitution of this country, to perform certain other duties, to act as deputy of the Governor General, and to discharge the duties of the Governor General whenever he might be absent. I might point out to hon. members that the duties in that respect are somewhat more extensive than has been suggested by hon. members who have addressed this committee in opposition to the proposed legislation. Not only had he the duty of representing the Governor General from time to time, at the opening of parliament when a new parliament had been assembled, and during the sessions of parliament from time to time when legislation required the assent of the Crown, but he also had the, duty, and discharged the duty from day to day, during the Governor General's absence, of examining all the Orders in Council and giving his approval to them. I know personally that the Chief Justice of the Supreme Court of Canada has spent a considerable amount of time each day during the absence of the Governor General in performing that duty.
To go back to the observation which 1 made a moment ago, each puisne judge of the Supreme Court received a salary of $9,000, and the Chief Justice received as such, a salary of $10,000 a year. In addition to that, in view of the obligation placed upon him under the constitution to discharge the duties to which I have alluded, he had the additional remuneration mentioned by the Minister of Justice, amounting altogether, I think, to $5,000 per annum. By the legislation of last session the salary of each puisne judge of the Supreme Court of Canada was raised to $12,000-I think I am correct in that -and the salary of the Chief Justice of Canada was fixed at $15,000 a year. It was provided that that sum should include everything which had previously by way of allowance been voted to him from year to year in remuneration for the duties which he discharged as deputy Governor General. So that after the legislation of last session had been passed the Chief Justice of Canada received in all precisely the same remuneration that he had been receiving before, and each of the Puisne Judges of the Supreme Court of Canada receives $3,000 in addition to the salary that had been provided for him up to that time. The Minister of Justice has spoken of the further provision, of the Act of last session which declared that any judge receiving an addition to his salary under that legislation should be liable to income tax. In the terms of the fSir Robert Borden.]
statute, that was made applicable to the Chief Justice of the Supreme Court of Canada, although, as a matter of fact, he received no actual increase to the remuneration which had been provided for him before. I am perfectly confident, and I am sure every hon. member must be confident, that the gentleman who is filling the position of Chief Justice of Canada would desire no exceptional treatment. It is merely suggested that he should receive fair treatment and, inasmuch as the remuneration which he is receiving at present is the same in amout, although differing in the method of appropriation, as that which he had received before, he naturally would feel that he ought not to be treated as if he had received an actual increase of salary. If I understand the statement of the Minister of Justice, that is exactly the position which he is placing before the committee to-day, and under all circumstances it seems to me that hon. gentlemen, on reflection, ought to reach the conclusion that the proposal, upon its face, is not unreasonable and is no more than just.


William Cameron Edwards: If this resolution
carries, as I understand it the Chief Justice's salary will be exempt from income tax. Suppose, as suggested by my hon. friend from Royal (Mr. McLean) this House saw fit to increase the Chief Justice's salary to $20,000, would he then come under the Income Tax Act?


Robert Laird Borden: I really do not desire to enter into a discussion of hypothetical questions, but in the case which my hon. friend has cited, there would be a distinct increase in remuneration, and there-a liability to income taxation. The point I have endeavoured to make, if I have succeeded in putting it clearly before hon. gentlemen, is that the Chief Justice of the Supreme Court of Canada is receiving, in respect of the duties which he performs as Chief Justice and as Deputy Governor General, exactly the same amount as that which he received before the legislation of last session was passed.


William Cameron Edwards: But if his salary were increased to $20,000 he would be liable to income tax, because there would be in that case an actual increase in his salary. How is it that he is liable to income tax now, in view of the fact that there has been no actual increase in his salary?


Robert Laird Borden: It is' clear, I
think. The form of remuneration has

changed, without the necessary qualification of the statute which should have been thought of last year, and which the Minister of Justice is now bringing to the attention of the House.


William Cameron Edwards: That is to say, his
salary does come under the income tax law. Why?


Robert Laird Borden: Owing to an
oversight in the legislation of last year which is now being remedied.


William Cameron Edwards: If the Act is wrong,
then make it right.


Robert Laird Borden: That is what
the Minister of Justice is doing.


Mr. HOCKEN:: It is interesting to observe that if the salary of the Chief Justice had not been increased, but $5,000 had been appropriated as formerly, he would be liable for taxation on that $5,000. Was there any contract exempting him from payment of taxes on that $5,000 as well as on the $10,000? I do not think the question of the independence of judges comes into the matter at all; you might as well talk of the independence of members of Parliament. We had to pay income tax before our indemnities were increased, and every business man must pay his taxes, no matter what he makes. The situation is a rather strange one in view of the fact that this gentleman would be liable to pay taxes on $5,000 if he had been left in the position he was in before the Act of last session was passed.


Robert Laird Borden: The legislation proposed by the Minister of Justice has no effect whatever except in respect of the present incumbent of the office of Chief Justice. The purpose of it is to place him in the same position as he would have been in, if the legislation of last year had not passed.


Mr. BEST:: Would it not apply to his successor?


Robert Laird Borden: No; it has no application to any future incumbent.


John Best: I believe that the Chief
Justice and every judge should have a good salary. I am in favour of that, because they should be placed in an independent position. But we have a lot of trouble in Canada to-day, principally because, in my opinion at least, the people think that there are some who get too much and others who do not get enough. How can I go before
my electors, who are honest people, some of them working hard the whole year round for $3,000 on which they have to support their wives and families, and justify a thing like this, when those people have to pay income tax on what little they make, while the Chief Justice goes scot free? I oppose that principle, for I do not believe that any man should be allowed to get off without paying the tax. If the salary is not enough, increase it, but let us have the same system applicable to all classes. I oppose the resolution on principle, and not because I think this gentleman is receiving too much. Probably he should get more. But the principle is wrong, and I cannot support it.


Mr. ROBB:: The Minister of Justice, in introducing this resolution to-day, is creating embarrassments for his colleague the Minister of Finance, upon whose department devolves the duty of collecting the taxes to meet the extravagances of the Government. How can the Minister of Finance go out and demand taxes from people who are drawing $2,000 or $3,000 a year, when they know that his colleague the Minister of Justice has passed special legislation to exempt the Chief Justice of Canada, who has a salary of $15,000? The minister says it was owing to a mistake of last year; but that particular mistake and the resolution which the minister brings in to-day are creating new embarrassments for the Minister of Finance, who already has lots of trouble, and it seems to me that the minister would be well advised to accept the advice of his own supporters and withdraw the resolution.


Charles Joseph Doherty: I should like to repeat one thing I said before, something which I do not appear to have succeeded in having penetrate into the minds of some of my hearers. I did point out that this legislation does not create exemption from taxation; that was created by legislation of the past which applied to the salary of the Chief Justice and, at that time, of all judges. The legislation of last year withdrew that exemption upon the ground that the conditions were being changed to the advantage of the judges concerned.


Lucien Cannon: Are the salaries of judges at present taxable not only as regards the increase but on the old salary?


Charles Joseph Doherty: The taxation applies to the old salary.


Lucien Cannon: The old salary plus the increase?


Charles Joseph Doherty: Yes.


Lucien Cannon: Why not treat the Chief Justice of Canada the same way?


Charles Joseph Doherty: The proposal is to treat the Chief Justice exactly in the same way as any judge whose salary was not increased-that is all that we are doing. Under the law that withdrew the exemption from every man whose salary was increased this one gentleman found himself liable although he got no actual increase. This legislation is not to create a new exemption, it is to correct the error that withdrew the exemption.


Mr. TWEEDIE:: The hon. member for Toronto (Mr. Hocken) suggested a question which I think has not yet been answered. The Chief Justice of Canada acts in a dual capacity,Chief Justice of the Supreme Court, and Deputy Governor General of Canada. Under the old statute he receives a salary of $10,000 a year as Chief Justice and for acting as Deputy Governor fee gets $5,000 a year. It is virtually a matter of contract between the Government and the Chief Justice that his salary of $10,000 shall not be liable to taxation, but would the exemption apply to the salary of $5,000 paid him as Deputy Governor General?


Mr. CURRIE:: As a layman I have some reluctance to discuss legal matters. However, the House is at one on this question apparently, and that is that there is no desire on the part of anybody to penalize the Chief Justice; it is only a question as to the method by which we may overcome this difficulty. Evidently the law of last year created the difficulty, and 1 think the simplest and easiest way of overcoming it is to grant an increase in salary. We are confronted with the difficulty that we cannot make any increase in the Estimates submitted to us by the Government-in fact in view of some past rulings of the Chair I am doubtful whether we can even discuss an increase in the expenditures. If, however, it is desirable to make up the sum to the amount of taxation that the Chief Justice is subject to, why not add $2,000, or $3,000, or $4,000 to his salary and let it go at that, and not have the impression go abroad that we are letting somebody escape from having to pay taxes? It is the easiest way to overcome the difficulty, and to my mind

would best meet the situation as far as members on this side are concerned.


Charles Joseph Doherty: First with reference to the question of the hon. member for Calgary (Mr. Tweedie). I have not the statutes before me, and I am not in a position to say positively whether the $5,000 paid to the Chief Justice as Deputy Governor was or was not liable to taxation. I recognize that the point ought to be looked into because it is not the desire to make his position better-the intention is to make it just what it was.
With regard to the other suggestion that we should meet this situation by an increase in salary rather than by the method proposed, I think it certainly is deserving of consideration. There is, however, this to bear in mind from the point of view of the charge on the country-that if you increase the salary it will apply to every future Chief Justice, whereas this provision would be of application only to the present incumbent of the office. If I might make a suggestion it is this: the necessity of passing a resolution before introducing this Bill is mainly, if not entirely, due to the clause which has not been questioned- that is the clause providing the additional salary for an additional judge in Saskatchewan. Now the suggestion I was going to make to the Committee is this: the passing of this resolution does not mean the enactment of the measure, it only makes it possible to introduce the Bill. The whole matter will have to come before the House when the Bill comes up for consideration, and my suggestion therefore would be that if the Committee pass the resolution we will consider between now and then the suggestion that has been made and be in a position later on to determine which is the more desirable course to take.


John Allister Currie: As long as we are not adopting the principle involved, and the Government is willing to consider the point raised, I do not see why we should! not pass this resolution.


Charles Joseph Doherty: The Committee will be at perfect liberty to deal with the matter at a later stage.


William Stevens Fielding: As stated by the Minister of Justice the case is this-that by an error in legislation last year we did penalize the Chief Justice and that was not the desire of Parliament. As stated by the right hon. gentleman this legislation, or something equivalent to it, is necessary to keep faith with the Chief Justice. Accept-

ing it in that spirit I desire to support the resolution, because I do not imagine that you can accomplish the same purpose in any other way without as much, or more, money being involved. But the discussion will be useful I think in the consideration of certain general principles to which I would like to make brief reference.
In the first place, I entirely agree with all that has been said regarding the desirability of giving our judges good salaries.
I have supported every proposition that ever came before this House to advance the salaries of the judges; and if in the judgment of the Department of Justice and the Government of the day it would appear necessary, at any time, because of high reasons of State, to advance these salaries -not all of them-to a fair degree, in all probability I would support the proposition;
I would not object to any generous and liberal stipend that is given if it is given as a straight salary. Then there should be no exemption. In this period of unrest when people are so unreasonably pressed it is an ugly thing to find some poor struggling business man paying a tax on $2,000 and discovering that a man receiving $15,000 is exempt; it is a bad state of affairs and it should not happen. Let us give the judges-and for that matter all other officials-decent salaries, but let them stand before the law and the country as citizens and pay their income tax the same as anybody else.
The next point I wish to make is this: I do not want any judge to be getting any pay by way of "side shows." I do not think the Chief Justice of Canada should get one penny for any extra duty discharged by him outside of the office of Chief Justice. I do not think he should be paid for acting as Deputy Governor General; it is part of his duties as Chief Justice of Canada. Pay him a decent salary as Chief Justice, and then see that he performs all the duties of his office. I do not think he should get a separate allowance in any shape or form, neither do I think that judges should get allowances for serving on commissions. The essence of the whole thing lies in giving a judge a liberal or generous salary and seeing that he gets it straight and square; do not pay him extra for doing something else. I do not believe either in dual services or dual salaries. Whatever the Chief Justice of Canada receives he should receive by virtue of his position as Chief Justice. The salary he gets as Chief Justice should be sufficient, and he should
not be paid any more for any other purpose whatever, from the treasury of Canada.


Arthur Meighen: I think I can say I am in hearty agreement with the hon. member (Mr. Fielding). The reason he gives for the introduction of this legislation has been, in the few words which he employed, as well put as it could be. Rightly or wrongly Parliament has historically adopted this principle-that when a judge's salary is fixed that salary shall not be reduced, shall not be subject to the will of Parliament whether exerciseable by way of reduction of salary or by way of the imposition of a tax. It may be questioned whether Parliament was wise in going so far as that. I know that this Parliament merely followed the example of the British Parliament, and I think the legislatures of United States as well, in that regard. It was thought that the desirability of placing the judges in a position where they could in no way be influenced in their conduct by a desire to appease Parliament or Government or anybody else was worth paying this price for, and that there should be taken from Parliament even the right by practice, if not by statute, to reduce their salaries at any time in the future, whether by actual deduction or by tax. I know it can be argued with some force that in going to that extent we may have gone too far. It may be argued that judges would not be subject to influence in any degree by taking their chances with the rest of the country; if the necessity for taxation came, even though it should mean a reduction in their remuneration, they would take their chances in that regard. But, any way, this much must be admitted, that whether the argument against any deduction under any circumstances is strong enough or not, it could not be contended for one moment that you should apply one rule to one judge or class of judges, and another rule to another judge or class of judges. The Chief Justice of Canada is entitled to stand in just as good a position in that regard as any other judge in the country.
Now, as a matter of fact when the Chief Justice came to his position he was entitled at law to a remuneration of $15,000. Consequently if we are going to adhere to the principle at all, we must see that that is not deducted from in any way whatsoever. We failed in this a year ago because it was not observed that the form of the statute was such, that the remuneration which he had a right to expect when he

took office was not secured to him. Having failed to do that then, whether the principle is right or wrong-and I think I speak the word of this House when I say that, though something can be said against it, on the whole the weight of argument is in favour of it-whether the principle is right or wrong, it must be adhered to in respect of the Chief Justice of Canada if we are to adhere to it at all. To adhere to it we must pass this legislation.
Only one possible argument that I can see should be taken into account in further consideration of this matter, and that is the argument advanced by the hon. member for West Toronto (Mr. Hocken) and supported by the hon. member for Calgary (Mr. Tweedie), that possibly under the law and the practice as it stood when the Chief Justice took office he had no right to expect that there would be no deduction for income tax in respect of the $5,000. If so, then we would still adhere to every principle that we have ever adhered to, if we made an exception in respect of that $5,000. Consequently I think that is a matter for further inquiry, but, except as regards that, it does seem to me that there is no sound argument against passing the Bill, and if we fail to pass it we shall be failing in our obligation to the Chief Justice of Canada.


Mr. NESBITT:: Is the Governor General's salary exempt from taxation?


Arthur Meighen: That is of course another question. My understanding is that it is.


Edward Walter Nesbitt: If so, why should not the deputy's salary be exempt when he is acting in the Governor General's place?


Arthur Meighen: That is another matter altogether. But the hon. gentleman, I am afraid, has missed the argument as I have sought to present it,-this seems to be a subject that it is impossible to state clearly; I studied the method of presentation as carefully as I could, and I have done my best to make it plain to all. The point is this. We have adopted in this Parliament, as in the British Parliament, the practice of securing to our judges the whole amount they had a right to expect would be secured to them when they took office. We departed from that practice in the case of the Chief Justice, in that we did not observe that the form of the statute imposed an extra deduction upon him. Having departed from that practice, we seek now to make it right. We want to make it right, but we do not want to go

one dollar further; and if we are going further in respect of the $5,000 the Act should be amended. That is the intention of the Government.


Samuel William Jacobs: I would like to ascertain from the Minister of Justice why it is that when the salaries of all the other judges were increased no provision was made for increasing the salary of the Chief Justice of Canada?


Charles Joseph Doherty: I hope that light maj shine in the darkness and that this time the darkness may comprehend. What was done was this. The salary, designated as salary, of the Chief Justice of Canada was $10,000. The salary so designated was made $15,000. But the Chief Justice, in addition to the salary of $10,000 so provided in the Judges' Act was in receipt of $5,000 a year for duties performed as Deputy Governor General. The wording of the statute last year in terms increased his salary as Chief Justice from $10,000 to $15,000, but went on to provide that that $15,000 should cover all the services rendered by him as Deputy Governor. So that while the statute with one hand, addressing the gentleman as Chief Justice, handed him a five-thousand-dollar increase, with the other hand, addressing him as Deputy Governor, it took $5,000 away from him. And so as to the amount he received he was landed just where he was.


Samuel William Jacobs: Why was that?


Charles Joseph Doherty: It was thought wise to include the whole remuneration in one sum precisely for the reason stated by the hon. member for Shelburne and Queen's (Mr. Fielding)-that it was considered undesirable that a chief justice or other judge should be receiving remuneration under other titles than the title of his judgeship. So uniting the two sums, as I said, in words we increased his salary, but, in fact, suppressing the remuneration of the Deputy Governor, we left the Chief Justice and Deputy Governor in receipt of $15,000.


Samuel William Jacobs: That is to say, he is receiving now the same salary that he received before only in another form?


Charles Joseph Doherty: Yes.


Samuel William Jacobs: Is it not a fact that the Chief Justice refused to accept an increase in salary because it would have affected his pension?


Charles Joseph Doherty: He never refused to accept any increase.


Samuel William Jacobs: Then why, when we increased the salaries of the superior court judges of the province of Quebec from $5,000 to $9,000, almost double-there are cases of that kind-and his puisne judges are receiving as I understand, $12,000 a year, is the salary of the Chief Justice of Canada left at only $10,000, plus $5,000, or altogether $15,000? The butcher and the baker do not ask whether he got this partly as deputy governor and partly as judge. He was getting $15,000 before, and he is getting $15,000 now. It is simply the difference between Tweedledum and Tweedledee. The fact remains, that the Chief Justice of Canada to-day is not getting any larger salary than he did before, while all the puisne judges and the chief justices of the provinces have had their salaries advanced. That seems to me to be an anomaly.


Charles Joseph Doherty: That may be the reason why, as has been suggested, we should increase his salary. But is that a reason why we should subject his unincreased salary to a deduction? This legislation is only for the purpose of correcting that.


Samuel William Jacobs: I have no objection to the legislation.


Charles Joseph Doherty: I am open to consider objections.


Lucien Cannon: Is it not the fact, Mr. Chairman, that the law last year providing that a judge could receive no other salary but his salary as judge made it impossible for the Chief Justice of Canada to receive a salary as deputy governor, so that in reality his salary was increased by $5,000? If his salary had not been fixed at $15,000, according to the law passed last year he could receive only $10,000, because if he had drawn any salary as deputy governor it would have been against that law.


Charles Joseph Doherty: His being deprived of the right to receive any outside remuneration was the condition under which he was given an increase. Before the legislation of last year, there was nothing to prevent his receiving a salary as Deputy Governor.


Lucien Cannon: But there has been since.


Charles Joseph Doherty: In the case supposed, if we had granted no increase there would have been no prohibition in respect of receiving outside remuneration.


Lucien Cannon: If then, a judge in the province of Quebec declined the increase,
would he be permitted to receive outside remuneration?


Charles Joseph Doherty: All these things were dealt with by specific provisions. The case of the Chief Justice was dealt with by a specific provision so far as the Deputy Governorship was concerned-that his salary increase as judge should cover that. Then, the general prohibition of the receiving of other sums was dealt with by a prohibiting provision. The question of exemptions from taxation was dealt with by permitting a judge to decline the increase, in which case he would not lose his exemption. The Chief Justice was deprived of any extra remuneration as Deputy Governor, but it was provided that the two salaries should be merged into one, whereupon he became subject to the general prohibition against receiving any other remuneration.


Lucien Cannon: Would the exemption apply also to the pension received by the Chief Justice?


Charles Joseph Doherty: The exemption from taxation fell upon the pension as well as upon the salary of every judge who became liable to taxation. The Chief Justice, having received no actual increase in remuneration and being not liable to taxation before, remained not liable to taxation, and that exemption applied to his salary as well as to his retiring allowance.


Lucien Cannon: If this legislation is adopted, then, the Chief Justice of Canada will not have to pay any taxes on his pension.


Charles Joseph Doherty: In the same way that every judge who declined to take the increase provided by the legislation of last year is entitled to his salary and to his retiring allowance exempt from taxation.


Lucien Cannon: I am not opposed to the resolution; I am simply looking for information. The minister says that judges who have had their salaries increased may not receive any outside remuneration; but is it not a fact that even since the enactment of last year the right hon. gentleman has permitted judges to deviate from that rule and to draw moneys that they should not have drawn?


Charles Joseph Doherty: Will the hon. gentleman be good enough to give specific cases?


Lucien Cannon: I will give the minister the case of Judge Desy, of Three Rivers, who has drawn $6,500 from the city of

Three Rivers as Royal Commissioner, an amount to which he is not entitled. The attention of the right hon. gentleman has been drawn to that case, but I do not think he has done anything. Does he intend to do anything?


Charles Joseph Doherty: I am surprised that
so distinguished a lawyer as my hon. friend should not be aware that the Minister of Justice exercises no authority over the judges. I do not sit here as the judge of the judges. If hon. gentlemen know that a judge has violated the law, the courts are open to them.


Lucien Cannon: Parliament, too.


Samuel William Jacobs: And impeachment.


Charles Joseph Doherty: If hon. gentlemen
know that there is ground for impeachment, it is in their power to institute the necessary proceedings. If they think that the circumstances call for official action by the Government I would respectfully suggest that they bring the matter to the attention of the Government elsewhere than on the floor of Parliament. A specific rule of this House makes it not permissible to launch accusations against the judges on the floor of Parliament. There is only one method of disciplining a judge. If there be ground for impeachment in this instance, even if action ought to initiate with the Department of Justice-which I am not prepared to admit-I would suggest that the hon. gentleman give us the necessary information.


Lucien Cannon: The minister has the information.


Charles Joseph Doherty: I have read a newspaper article which states that for holding % commission for a municipality this honourable judge received a remuneration. I myself do not undertake to be responsible for the statement of facts. But in the statute which sets forth the services in respect of which the judge is forbidden to receive extra remuneration there is reference to Government and provincial requirements; there is a saving of any right existing in favour of a judge under a Dominion or a provincial statute. Now, I have not studied the case, because I am not, as I have said, sitting here as master of the judges or as judge of the judges. But the question that arises is this: That was a municipal investigation, and if my memory serves me aright-I am speaking only from recollection-the laws of Quebec provide that, in certain instances, judges may be
[Mr. Cannon.C
called upon under those statutes to hold certain investigations in municipal matters.


Lucien Cannon: But they get no money for doing so.


Charles Joseph Doherty: My recollection is, and I know of numerous instances where municipalities have considered that it was proper to pay the judge, and where he has been paid. In the particular instance, I understand the municipal council passed a resolution and made the payment. There is in connection with the matter another fact of which I am not aware, but which is very, material-Was the judge called upon to perform that duty before or after the passing of the statute?


Lucien Cannon: After.


Charles Joseph Doherty: I have said all that I know about the matter; but what I want to point out, and where I think the hon. gentleman is mistaken, is, in the first place, when he puts this matter to me to know what I am going to do about it, and in the second place, when he suggests that we should try to decide that question before this House to-day. I really respectfully would call the attention of the Chairman to the fact that this is entirely out of order.


Lucien Cannon: Before the Chairman decides, it would be only fair to allow me to reply to the right hon. gentleman.


The CHAIRMAN:: I would regret to be charged with unfairness, but as the point of order has been raised I must rule this debate to be out of order. I do so for two reasons: First, because it is an attack or reflection upon the conduct of a judge.


Lucien Cannon: It was not an attack, it was a reference.


Georges Henri Boivin: All references to
judges and courts of justice of the nature of attacks or censure have always been considered unparliamentary and the speakers of British and Canadian Houses have always treated them as breaches of order. That will be found in Bourinot at page 358. The second reason is the well known rule that discussion in committee must be strictly relevant to the item or resolution under consideration.


Lucien Cannon: In answer to what the Minister of Justice said a minute ago as to the enforcement of the law of our country concerning the administration of justice in general, I simply wish to say this: The right hon. gentleman was kind enough

to refer to my legal standing. My legal standing does not compare in any way with the very eminent standing held by the right hon. gentleman in this country as a legal mind. Every man in this House 5 p.m. will admit that the right hon.
gentleman is one of the best lawyers; that he has been one of the best judges, and that he is now one of the best Ministers of Justice that we have ever had. Therefore, I was very much surprised when I heard him express the views which he expressed a minute or two ago, because I do not think those views are in accord with the real interpretation of the law as the law should read and be interpreted. The right hon. gentleman says: I am not the judge of judges, and if a member is not satisfied with anything that might happen in this province or any other province, let him apply to the courts of justice and have whatever abuses may have been committed, remedied or rectified. Discussing the matter on very general lines, and not, for instance referring, as the hon. member for Frontenac (Mr. Edwards) did, to a former Chief Justice of the Supreme Court as a thief, without being called to order, I will proceed and say that the Minister of Justice appoints judges throughout the land. The Attorney Genera)- of each province sees to the administration of the law within the province of which he is Attorney General. That is the general administration of the law. As regards the personal conduct, dignity and honour of each individual judge, it is the Minister of Justice who has to attend to that and not the Attorney General of a province. The righ, hon. gentleman, as he knows full well, is not only Minister of Justice, but Attorney General of Canada, and what for?


Georges Henri Boivin: I would be glad to hear any remarks the hon. member may desire to make to show the relevancy of this discussion to the resolution now under consideration. Unless he succeeds in doing so, I shall be obliged to ask him to discontinue his remarks.


Lucien Cannon: I cannot argue the
point of order; I understand it has been decided. I am only continuing the discussion along the lines which have been adopted by the right hon. gentleman himself. We have before the Chair a resolution to the effect that the salary of the Chief Justice of the Supreme Court of Canada shall be exempted from taxation, and in that resolution there are other
clauses providing for other matters in different parts of Canada. Under this resolution a very general discussion ensued, and the Prime Minister (Mr. Meighen), the hon. member for Shelburne and Queen's (Mr. Fielding), the hon. member for King's (Sir Robert Borden), the Minister of Justice (Mr. Doherty), discussed the question whether it would be wise or unwise to exempt from taxation the salary of the Chief Justice, and they also discussed the application of the law in general as regards all judges throughout the country. Following that very general discussion which has been allowed by the Chair throughout the afternoon, I am now discussing with the Minister of Justice very generally the question whether, should a judge, no matter who he is or where he sits, not behave as he should, it is for my right hon. friend as Minister of Justice for Canada or for the Attorney General of the particular province concerned to interfere.


Georges Henri Boivin: That particular
question had not been discussed until it was introduced by the hon. member for Dorchester (Mr. Cannon). That is the point raised by the Minister of Justice, and that is why the Chair has ruled this debate to be out of order. ~


Lucien Cannon: I shall not insist. The
field of discussion has been very suddenly narrowed down by your ruling, Sir, much to my surprise. You were in the Chair, and there was no call to order when the hon. member for Frontenac (Mr. Edwards), for instance, went very far and attacked the former Chief Justice of Canada and present Lieutenant Governor of Quebec. Yet there was absolutely no remark and no call of order from the Chair. But I always respect the Chair; I always respect your ruling, and seeing that you have allowed the Minister of Justice to say all he wanted and you are calling me to order and preventing me from answering him, 1 will now resume my seat.


Mr. PROULX:: I did not happen to be
present when the Minister of Justice (Mr. Doherty) gave the reasons for asking for exemption from income taxation of the salary of the Chief Justice.


Mr. ARCHAMBAULT:: Let the minister explain again.


Edmond Proulx: I cannot see any good
reason for this. Is it because the salary of the Chief Justice was increased more than the salaries of the other judges? Is it because the higher the salary, the more the exemption should be? Last year we

increased the salary of the Chief Justice from $10,000 to $15,000, or an increase of $5,000, and the salary of the other judges was increased from $9,000 to $12,000; there the increase was only $3,000. Yet theVe is no provision in this resolution to exempt the salaries of these other judges. I think the principle is wrong, and I believe that if you exempt the salary of the Chief Justice, who receives the highest salary of all the judges in the land, you will have very strong representations from all the other judges to have their salaries also exempt from taxation. I believe my right hon. friend is not well advised when he brings down this resolution asking for this exemption. I believe there should be no exemption from income taxation, and especially in the case of the judge who receives the highest salary of all the judges in the land.


Charles Joseph Doherty: May I just say one word, because I do not want to be lacking m courtesy to the hon. gentleman. I forego with great regret the opportunity of addressing to him the explanation I have already addressed to the House, because I have implicit confidence that in addressing it to him I would be addressing it to an intelligence that would grasp it at once. I only want to ask him to be good enough to read in Hansard the answers I have endeavoured to give to the questions which he puts, and which were put, before he came into the House, by other hon. gentlemen.


Mr. ROCK LANCTOT (Laprairie and Napierville):: (Translation.) Mr. Speaker, as in the past I have always taken much interest in this question of the judges* salaries, and as I have always been the only one to discuss the subject, it is with much pleasure that I find myself to-day, one of a goodly company of members, not only of the Opposition, but also of the Government side, and I now hope for better success before long.
I am always surprised to hear the right hon. Minister of Justice (Mr. Doherty) say, when discussing these questions of the judges' salaries, that the Government must keep its word even after a period of ten, fifteen or twenty years, and that no change can be effected. I find that since 1914, in this House and outside of it, much has been said, and yet owing to the war much has been changed. We had been promised that there would be no conscription, and yet we have had it. Granted these judges had been promised that they would not be

taxed, nobody was taxed in those days, no wonder they could be promised that they would not be, because there was no question of an income tax at that time. But to-day that taxation exists, and I do not see why a judge who receives $15,000 a year should not pay an income tax as well as the poor farmer who earns $2,200 and pays on $200 an income tax of $8. This man who gets $15,000 should to my mind pay the tax like every one else, and set a good example. Nothing is worse than bad example coming from above. The example set by the right hon. Minister of Justice, I hold to be of the worst kind, for the hon. gentleman is paid as a minister and as a member of the House, and draws at the same time a pension from the State. Then why cast doubts on the honesty of purpose of the Chief Justice of the Supreme Court? I would not suspect them.
Last year, the salary of the Chief Justice of the Supreme Court was raised to $15,000 and since then, I believe, he has drawn that salary. I do not know how payments to judges are made; they must be paid monthly or quarterly; at all events, he has likely received a part of those $15,000 since the passing of the last Act, and his salary having been increased, he has no right to be the deputy of the Governor General of this country with a stipend of $5,000. If he has that right and wants to draw those $15,000 the Government should select another man who would not be such an expense to the country. For my part, I would not object to such a change, and were I living in Ottawa I could perform those duties for a dollar a day-because I am a thrifty man -and I would deem it a great honour.
Before concluding my remarks, I beg leave to move as an amendment that the first paragraph of the resolution be struck out, that is that part which reads thus:
1. That the provisions of section 11 of chapter flfty-six of the statutes of 1920, entitled An Act to amend the Judges Act, withdrawing the exemption of certain judges from the operation of certain taxes, shall not apply to the present Chief Justice of Canada.
Amendment (Mr. Lanctot) negatived; yeas 38, nays 59.


Mr. McKENZIE:: What will be the
effect of the change proposed in paragraph 3 so far as the judges in the province of Nova Scotia are concerned? The Minister mentioned that the judges had the right to settle their own location. So far as the judges in Nova Scotia are concerned, I think they all reside in Halifax, so I do not think that would affect them.


Charles Joseph Doherty: There is no change so
far as Nova Scotia is concerned. The reason it is mentioned is that we are repealing the whole section and re-enacting it in order to make the change in the other provinces.
Resolution reported.


Charles Joseph Doherty: I desire to cover an
omission. The other day, by oversight I forgot to state that the resolution in question had been submitted to the Governor General and had obtained his approval. I desire to make thatl statement now.
I move for leave to introduce Bill No. 60, to amend the Judges Act.
Motion agreed to and Bill read the first time.



THE FRENCH TREATY

Right Hon.   S@: Mr. Speaker, I move for leave to introduce Bill No. 61, founded on the resolution, which was' passed to-day, respecting a certain trade arrangement between His Majesty and the President of the French Republic.
Motion agreed to and Bill read the first time. ,



SUPPLY - CANADIAN NATIONAL RAILWAYS PROPOSED REFERENCE TO SPECIAL COMMITTEE OF HOUSE

[Stage Direction]
Right Hon. ARTHUR MEIGHEN (Prime Minister) moved that the House go again into Committee of Supply.
['Well, I have not in my reading observed any statement which would give me that information, but I fancy it would take considerably over one billion of dollars. I understand that the American railway carriers claim from the United States Government something over $900,000,000 to put their roads back where they were prior to their being under federal control, and it is asserted that that would not commence to meet their legal and valid demands. I refer to the railway conditions in the United States only for the purpose of indicating that there is a railway problem in that country just as there is in this, and by way also of opposing the possible idea that our condition is entirely due to circumstances for which this country alone is responsible.\nNow, Mr. Speaker, what are the principal considerations which suggest the appointment of a committee, and how might such a committee function to the advantage of Parliament and of the country? The facts which I have just presented to the House in relation to the financial condition of our railways surely indicate the existence of a situation that must be considered, studied and dealt with by this Parliament and by the country. It involves the imposition of heavy taxation, and no intelligent and reflecting man will deny that the situation demands the gravest thought and study on the part of every Canadian who is interested in the present and future of his country. I suggest further that a large deliberative body or assembly such as this House of\n\nCommons is hardly suitable for the effective consideration of this problem. That is an assertion which cannot safely be contradicted; in fact, one might postulate that proposition. Our experience also shows that for the purpose of reaching constructive ideas and informing the members of the House and the people generally, as well as in reaching a definite public policy for the future, a small parliamentary committee affords the best means. Therefore, Mr. Speaker, on general principles a committee of Parliament should be appointed to consider the railway situation in itself as well as in its relation to all the other interests of the country.\nI should like also to suggest for the consideration of the House that Parliament requires information upon this question. I am not reflecting upon the knowledge which any hon. gentleman has or upon his capacity to obtain it and to utilize it when he gets it. But I think I may safely say that members of this House and the people of the country generally, outside of those who are engaged in the railway business as a vocation, are sadly in need of information on this subject. It is only when we are armed with knowledge that we can embark upon any definite policy for the future or that we can safely legislate. I think that one might say, without reflecting on past Parliaments, that a great many of our railway difficulties to-day are due to the fact that Parliament itself was not informed. The governments of the day thought that they themselves were informed, and possibly they were; but if there had been on the part of Parliament that degree of accurate knowledge regarding the matter with which the government itself was dealing, the government policy might have indicated greater wisdom than it did.\nNewspaper correspondents are beginning to say that our railway affairs had better be handed over to business men, and that members of Parliament and the Government would consent to this transfer of duties. I have all my life been looking for an accurate definition of this omnipotent so-called business man who is taken from his hiding place every time the nation is in great trouble. For my part, I do not admit the capacity of these business men to deal with the situation any better than anybody else, unless they are informed upon the subject-and I doubt very much that they are so informed at the present time. However, that is a point which I feel I need not elaborate; it is a self-evident proposition that before we take further steps in connection with the railway problem in this country, Parliament should be informed. I am not emphasizing the fact that the Government should be informed. That is their duty; we assume that they will take every possible step to inform themselves, but I go further and say that it is equally the duty of Parliament to be informed. I say with little trepidation that a parliamentary committee can do more to inform Parliament and the country upon this question than any other body which can be suggested. The presence of the management of the Canadian National Railway system before a committee of Parliament for a few days annually could not fail to inform Parliament and the country. There will be made public facts which cannot be made public to-day by reports through the Minister of Railways or the Government. Foolish and absurd statements are being made day after day, predicted upon assumptions which are not based upon facts. If there is anything dangerous to the country at the present time in relation to a great and important public service, it is having Parliament and the country debating the problem upon facts which have not been established. Expert opinion could be brought before that committee to advise members of the committee, in the hope that that advice, if worthy of credence and acceptance, could be extended through the committee to Parliament, and thus gradually get out into the country, so that sound and intelligent public opinion could be formed upon this issue. A committee before which the management might appear would also afford an opportunity to the management to give to the country their views of the situation, and generally speaking, a standing committee of this House is the best and, I am almost bold enough to say, the only method by which Parliament and the country can be educated as they should be upon this problem at the present time.\nWe must not forget that when a Government owns and operates a railway with a deficit of $50,000,000 in 1920 and a probable deficit of $100,000,000 in 1921, it is not likely to receive fair treatment from the people. The quality of the management will not be fairly judged by the country unless that management have an opportunity of putting before the people their side of the story of their management. Further, in years past in connection with the railway problem, when, perhaps, it was largely the function of railways to exploit the country, we passed laws to protect the public against the carriers. The situation', "\n\nis very much changed. The railway question will never again appear before the public in the exact form in which it did from ten years bade to twenty-five or thirty years preceding that. The country to-day is the owner of a great system; the people are the shareholders; they must pay out of their pockets any operating deficits; they must provide capital for the continuance and operation of the road. While heretofore it was, perhaps, largely the work of Parliament and statutory bodies created by Parliament to protect the public against the carriers, it may be that now our true function will be to protect the carriers against the public. There is, at least, something in that statement.\nAt Six O'clock the House took recess.\nAfter Recess\nThe House resumed at Eight o'clock."]
Hon. A. K. MACLEAN (Halifax):: Mr. Speaker, I wish to avail myself of this opportunity to move an amendment which is substantially the same as the notice of motion which stood in my name for several days and which had relation to the appointment of a committee to be known as the Railway and Shipping Committee. Last evening, the House will remember, I moved for the discharge of that motion from the Order Paper. I did so because I was likely to be absent from the House during the next few days, and also because, even were I sure of being here continuously, there was considerable doubt as to when I might have an opportunity of moving that motion. I was anxious to be able to present it to the House as early as possible, and after consultation with the Prime Minister last evening, I made the motion for the discharge of that motion from the Order Paper, which was unanimously carried by the House. Upon giving notice this afternoon to the Prime Minister of the text of this amendment, he pointed out to me that his position would be somewhat prejudiced by my moving it on a motion to go into Supply, and that possibly he might not have consented last evening to my motion being discharged from the Order Paper had he understood that this amendment would be moved to-day on the motion to go into Supply. I refer to this fact merely to say that I do not desire to prejudice the position of my right hon. friend or his supporters, particularly if any embarrassment to them were due to any act or word of my own. Therefore, upon the conclusion of the debate on this amendment, I shall ask the House for leave to withdraw it. It will be understood, of course, that when the right hon. the Prime Minister comes to move for the appointment of a committee, which, I understand, he has intimated he will do, there will then be an opportunity for me or any other hon. gentleman to move for additions to the powers of that committee, if in my judgment or theirs it is felt that those powers are too limited.


Charles Murphy: I dislike interrupting the hon. gentleman, but did he say that the amendment which he is about to move this afternoon is substantially the same as the motion he got leave to withdraw yesterday? If so, in what respect do they differ?


Alexander Kenneth Maclean: The only respect in which they differ is that the period of continuance of the suggested committee is limited, in this amendment, to this session, and it was my intention to incorporate that amendment in the original motion had I moved it. Now, the purpose of the amendment is disclosed in the text itself; the reading of it will show the intended functions of the committee if this House decides to establish it. The name of the committee also suggests substantially the range of its jurisdiction. I think that such a committee should have the right and power to enquire into substantial matters of policy connected with the management and administration of the Government owned and controlled railway system of this country, and as well the shipping, which is known as the Canadian Government Merchant Marine. I should hope that the work of this committee, if it were appointed, would be of a substantial and informative character; if it were not, it would fail to fulfil the terms which I have in mind at the moment. It is not my intention that there should be conferred

upon this committee supervisory or administrative powers over railway matters-and when I refer to railway matters, the House, I trust, will bear in mind that I have reference only to the system of railways known as the Canadian National Railways. I should hope that this committee would be the means of supplying a great deal of information to the public in connection with the government-owned system of roads; that it would be the instrument by which the management of this railway system could convey to the public, who are its owners, an account of their stewardship, and in this manner give a review of existing or contemplated policies of the Board. I should hope that this committee, if established, would establish between the Canadian National Railways and the Canadian public some such relationships as exist between an ordinary commercial enterprise and its shareholders. I should hope that there would be established, as between the management and Parliament, at least the relationship which ordinarily exists in commercial concerns between the management and the board of directors or the shareholders. Now, Mr. Speaker, I realize that asking for the creation of a committee with such wide powers is perhaps somewhat unusual in our parliamentary experience, and I therefore realize very clearly I trust that in order to induce Parliament to accept my proposal I must convince, or should endeavour to convince Parliament that a serious problem confronts us to-day. If I succeed in doing so I think it should follow that the proposal contained in the amendment should be granted, and that a committee, to whom should be granted unusual powers, should be set up to meet an unusual situation. In order to do this I must refer to certain matters relating to dhe Canadian National Railway system, and particularly to the economic condition of that system. I do so primarily for the purpose of impressing ithe House, if I can, with the gravity of the situation now confronting it.
'A few days ago the Minister of Railways presented to the House what is known as the annual railway statement, which statement contained a great deal of valuable and important information regarding the Canadian National Railway system. I do not know that the statement which the minister gave could have been more complete without it becoming somewhat burdensome to himself and to the house. However, we learned from the minister that there are in Canada to-day 17,000 miles 
of railway controlled by the Government, and possibly this mileage shall later be increased by the acquisition of the Grand Trunk Railway. We learned that in 1919 there was a deficit of $48,000,000 on account of operating and fixed charges, that in 1920 there was an operating deficit of $37,000,000, and that in 1920 there was a deficit of $70,000,000 on account of operations and fixed charges. We further learned that 95 per cent of the gross revenue of the system was consumed by two items alone- wages and fuel. We also learned from the statement that it cost $1.24 and a fraction to earn a dollar during the past year. The minister on that occasion likewise gave to the House his statement of net earnings for the current year, the railway year being the calendar year. He estimates a deficit of $50,000,000 on account of operating and fixed charges, and including interest on advances to the Canadian Northern Railway he calculates that this deficit will be increased to $60,000,000. This is reached by taking into consideration a possible decrease in wages, in the cost of materials, and by effecting economies which I fancy he hopes to be able to successfully introduce. So you see that the deficit in 1919 was very substantial, it was very substantial in 1920, and I suggest there is little or no evidence that if will be any less in 1921 notwithstanding the minister's estimate-in fact everything known to us suggests a very much greater deficit than we had in 1920.
Now considering the commercial and trading conditions of the world, the conditions of the European exchanges, the decrease in the productive powers of Canada and all other countries, the fact that even in Canada during the past three or four months the producers of lumber, fish, coal, iron and steel have reduced production [DOT]-I think it is probably a fair estimate to say that in the Prairie Provinces there will be a diminution in the production of wheat, largely owing to the fact that the cost of production is abnormally high, and the markets and prices are not very reassuring; -taking all these conditions into consideration I think it is fair to say that when the current railway year ends on December 31 this year we shall learn that a deficit considerably in excess of the deficit of 1920 confronts this country, and that I am sure will be regarded as a very serious situation. But the condition of a railway is not altogether revealed even by the operating results. It is true that the deficit of 1920 is, in itself, sufficiently staggering. It is also

I have no doubt, true and well known to hon. gentlemen that it is extremely desirable that a road should have more than a mere surplus of operating income; it is extremely desirable that it should build up a reserve. The Canadian National Railway system, in the face of the existing deficits, was unable to build up, or to add to, reserve. Further, the failure to have an operating income upon the credit side, the failure to be able to earn anything to add to a reserve, affects the credit of a railway company, and doubtless the borrowing capacity of the Canadian National Railway system has been disastrously affected by the result of the operations of last year. I think I am correct in saying that to-day the Canadian National Railway system would be unable to borrow any money in the markets of the world without the guarantee and backing of the Canadian Government. That being so, and I hardly think anybody can question my statement, I feel compelled to say, although very regretfully, that at the moment our National Railway system is practically bankrupt. In ordinary affairs an individual, or a commercial concern, is not considered bankrupt while they are able to pay and meet the demands of their creditors; but it is altogether different in connection with a railway system. As soon as a railway system reaches the condition that it is unable to borrow upon favourable terms it is bankrupt-because the operations of a railway never cease, it must be continually expanding. Further, we are all aware that during the past four or five years a great deal of money should have been spent upon maintenance, development and construction work, in connection with our railways. This has been deferred. I am not criticising anybody for so doing; I should say that that was good business policy. But nevertheless that fact must be taken into consideration in a review of railway conditions to-day. I make the statement, not authoritatively of course, but I think I am well within the mark, that no less a sum than $150,000,000 should this year be expended upon the Canadian National Railway system for maintenance, and improvements in order to prevent the impairment of our railway assets. That, Mr. Speaker, is a serious situation to contemplate, and I have not the slightest doubt that every hon. gentleman is impressed with its seriousness, particularly when coupled with the fact that we are facing for the current year such a large deficit.
Now, we can hardly hope to increase our railway revenues by a further increase in freight or passenger rates. It may be fairly stated, I think, that to-day our freight rates are at such a figure that they adversely affect the production of goods and our domestic and export trade. These high freight rates in turn contribute to the continued high price of commodities, thus lessening the ordinary exchange of goods and the total volume of the production of the country and their consumption, which in turn leads to unemployment. I have no doubt also that the fact that a great deal of maintenance work on our railways has been deferred also contributes to unemployment. And I think I may with greater confidence say that our passenger rates at least have reached that point when it would be inadvisable to further increase them. The statement of the Minister of Railways indicates a decline of 9.45 per cent in the number of passengers carried per mile in 1920 as compared with 1919. I think I am reflecting probably the judgment of the average member of this House when I say that our passenger rates might be reduced somewhat and thus stimulate the earning power of our railways. Therefore I say that we cannot well look to increasing railway revenues for the current calendar year by increasing freight or passenger rates; on the contrary not at all improbable that better financial results might be obtained by here and there a slight diminution in the rates.
Now, Sir, I do not refer to the financial condition of our railways with any degree of pleasure. It is not a condition that one would care to proclaim in Parliament in a malicious spirit or to injure his country; but facts must sometimes be faced boldly and courageously, and I think it is far better that Parliament and the country should realize the actual situation confronting us.


Alexander Kenneth Maclean: And in other countries also.


Alexander Kenneth Maclean: Yes, I am going to refer to that. There is some comfort in the reflection that in other countries approximating conditions prevail. When one thinks of the great extent of this Dominion, of the sparseness of its population, of the lack of development of our natural resources, and of the physical condition of a great deal of the country through which our railway system operates, it is not surprising to find the present results. I am sure we all have hope for the future. This country has the capacity to expand com-

mercially and otherwise, and it certainly shall, but of course in the immediate future our problem is a very serious one. I do not think that our position should be prejudiced by the fact that the other great railway system in this country presents a very much better showing for the past fiscalyear. I have never been able to appreciate why a statement of the financial condition of the Canadian Pacific Railway Company can be expected to contribute to the solution of our own railway problem. There are many obvious reasons why that system is in such a relatively flourishing condition to-day. The two systems are unlike and cannot be compared. To my mind it contributes very little to clearing the general situation to find so many flattering commendations made of the one road and so many unreasoned and unreasonable condemnations of the other.
Of course, a great deal of the present situation is due to the conditions ensuing from the war, and, as has been suggested by my hon. friend (Mr. Maclean, York) opposite, that fact has left similar results in many other countries. It would be very interesting just for the moment to look at the railway situation in the United States, where conditions are much the same as here, except that that country has a much greater population and is more fully developed. In 1920 it cost the American railways on an average $93.59 for every $100 earned; in 1919 the operating ratio was $85.25; in 1918, $81.54; in 1917, $66.46. The net operating income of the United States railways of the first class dropped from the high level of $934,000,000 in 1917 to $62,000,000 in 1920. In January, 1921, the operating deficit of 143 railways in the United States was $3,000,000, compared with a net operating income of $42,000,000 just a year before, in January, 1920. This, of course, indicates the existence of fundamental conditions prevailing in the United States as in this country which affect very greatly the railway situation. In March of last year the American railways passed from federal control back to their owners, the transfer being made under the provisions of the United States Transportation Act of 1920. The legislators of that country evidently felt that the future of their railway systems was not too fully assured, because in the Transportation Act they made provision for a stated income from earnings for these railways- a provision which had not previously existed. At present the United States railways are entitled to a minimum dividend of five per cent upon the value of the road and a minimum of, six

per cent. If an amount in excess of the six per cent is earned, the difference is divided between the railways and the nation as a reserve fund. The reserve fund belonging to the carriers is to be used by them for almost any railway purpose, while the proportion of the excess going to the United States Government is to be used by way of loans or advances to their railway systems. Further, the United States Transportation Act of last year provided for the voting of a revolving fund of $300,000,000, to be used for the purpose of aiding roads seeking financial support or assistance. That amount, I fancy, will meet but a small proportion of the applications for loans which will be made by the American roads.


Mr. ARMSTRONG (Lambton) :: May I ask the hon. member if he will be good enough to give an estimate of the amount that the roads of the United States will require to place them on a safe footing for the year?


Alexander Kenneth Maclean: Well, I have not in my reading observed any statement which would give me that information, but I fancy it would take considerably over one billion of dollars. I understand that the American railway carriers claim from the United States Government something over $900,000,000 to put their roads back where they were prior to their being under federal control, and it is asserted that that would not commence to meet their legal and valid demands. I refer to the railway conditions in the United States only for the purpose of indicating that there is a railway problem in that country just as there is in this, and by way also of opposing the possible idea that our condition is entirely due to circumstances for which this country alone is responsible.
Now, Mr. Speaker, what are the principal considerations which suggest the appointment of a committee, and how might such a committee function to the advantage of Parliament and of the country? The facts which I have just presented to the House in relation to the financial condition of our railways surely indicate the existence of a situation that must be considered, studied and dealt with by this Parliament and by the country. It involves the imposition of heavy taxation, and no intelligent and reflecting man will deny that the situation demands the gravest thought and study on the part of every Canadian who is interested in the present and future of his country. I suggest further that a large deliberative body or assembly such as this House of

Commons is hardly suitable for the effective consideration of this problem. That is an assertion which cannot safely be contradicted; in fact, one might postulate that proposition. Our experience also shows that for the purpose of reaching constructive ideas and informing the members of the House and the people generally, as well as in reaching a definite public policy for the future, a small parliamentary committee affords the best means. Therefore, Mr. Speaker, on general principles a committee of Parliament should be appointed to consider the railway situation in itself as well as in its relation to all the other interests of the country.
I should like also to suggest for the consideration of the House that Parliament requires information upon this question. I am not reflecting upon the knowledge which any hon. gentleman has or upon his capacity to obtain it and to utilize it when he gets it. But I think I may safely say that members of this House and the people of the country generally, outside of those who are engaged in the railway business as a vocation, are sadly in need of information on this subject. It is only when we are armed with knowledge that we can embark upon any definite policy for the future or that we can safely legislate. I think that one might say, without reflecting on past Parliaments, that a great many of our railway difficulties to-day are due to the fact that Parliament itself was not informed. The governments of the day thought that they themselves were informed, and possibly they were; but if there had been on the part of Parliament that degree of accurate knowledge regarding the matter with which the government itself was dealing, the government policy might have indicated greater wisdom than it did.
Newspaper correspondents are beginning to say that our railway affairs had better be handed over to business men, and that members of Parliament and the Government would consent to this transfer of duties. I have all my life been looking for an accurate definition of this omnipotent so-called business man who is taken from his hiding place every time the nation is in great trouble. For my part, I do not admit the capacity of these business men to deal with the situation any better than anybody else, unless they are informed upon the subject-and I doubt very much that they are so informed at the present time. However, that is a point which I feel I need not elaborate; it is a self-evident proposition that before we take further steps in connection with the railway problem in this country, Parliament should be informed. I am not emphasizing the fact that the Government should be informed. That is their duty; we assume that they will take every possible step to inform themselves, but I go further and say that it is equally the duty of Parliament to be informed. I say with little trepidation that a parliamentary committee can do more to inform Parliament and the country upon this question than any other body which can be suggested. The presence of the management of the Canadian National Railway system before a committee of Parliament for a few days annually could not fail to inform Parliament and the country. There will be made public facts which cannot be made public to-day by reports through the Minister of Railways or the Government. Foolish and absurd statements are being made day after day, predicted upon assumptions which are not based upon facts. If there is anything dangerous to the country at the present time in relation to a great and important public service, it is having Parliament and the country debating the problem upon facts which have not been established. Expert opinion could be brought before that committee to advise members of the committee, in the hope that that advice, if worthy of credence and acceptance, could be extended through the committee to Parliament, and thus gradually get out into the country, so that sound and intelligent public opinion could be formed upon this issue. A committee before which the management might appear would also afford an opportunity to the management to give to the country their views of the situation, and generally speaking, a standing committee of this House is the best and, I am almost bold enough to say, the only method by which Parliament and the country can be educated as they should be upon this problem at the present time.
We must not forget that when a Government owns and operates a railway with a deficit of $50,000,000 in 1920 and a probable deficit of $100,000,000 in 1921, it is not likely to receive fair treatment from the people. The quality of the management will not be fairly judged by the country unless that management have an opportunity of putting before the people their side of the story of their management. Further, in years past in connection with the railway problem, when, perhaps, it was largely the function of railways to exploit the country, we passed laws to protect the public against the carriers. The situation



is very much changed. The railway question will never again appear before the public in the exact form in which it did from ten years bade to twenty-five or thirty years preceding that. The country to-day is the owner of a great system; the people are the shareholders; they must pay out of their pockets any operating deficits; they must provide capital for the continuance and operation of the road. While heretofore it was, perhaps, largely the work of Parliament and statutory bodies created by Parliament to protect the public against the carriers, it may be that now our true function will be to protect the carriers against the public. There is, at least, something in that statement.
At Six O'clock the House took recess.
After Recess
The House resumed at Eight o'clock.



[Stage Direction]
Bill No. 53, to incorporate The Fort Smith Railway Company.-Mr. Douglas (Strathcona).
Bill No. 51, for the relief of George Elmor Glossop.-Mr. Copp.

[Stage Direction]
The House resumed the adjourned debate on the motion of Right Hon. Arthur Meighen (Prime Minister) for Committee of Supply.
['I do not see the connection at the moment. However, I promised the hon. member for Quebec East (Mr. Lapointe) that he would have an opportunity to-morrow to make some remarks-I do not know whether or not he has an amendment-in relation to labour matters; so I have on that account mentioned labour, and doubtless he will take advantage of the opportunity.']
Alexander Kenneth Maclean: At six o'clock I was urging upon the House that in connection with the railway question it was desirable that Parliament and the country should be informed, and that by such means alone could we develop in this country a public opinion that would aid in the solution of the railway problem. I think it is a fact that there is to-day very little public opinion in this country upon the railway issue, largely because Parliament has failed in recent years to he informed itself, and through it the country. I was suggesting to the House that a committee to which would be granted very large and extensive powers, perhaps broader than those to which we have been accustomed in the past, would aid in the formation of constructive views in Canada, which would be found of some value in the early future. Now if we cannot

get information and develop constructive ideas, and assist the public in developing sound constructive ideas upon the railway question, as things go on at present, how is this information to be obtained and disseminated throughout the country in order that the conditions I have suggested might be brought about? The Minister of Railways cannot inform Parliament upon this question, so big has it become. He would need to be a superman, if there is such a person, to do so. It would be an impossible task to impose upon any minister to keep Parliament and the country fully informed upon so vast and intricate a problem. The Government cannot do it. It is their declared policy deliberately to abstain from intervening in the administration of the railway, and, so far as I know, the Government are living up to that policy, and I trust they will continue to do so. One thing is certain, and that is that government ownership and government control could not last twenty-four hours in this country if there was direct interference in the administration of the railways by the Government or by members of Parliament. Therefore, the declaration of Government policy precludes Parliament or the country from being informed by the Government. That eliminates the two probable sources from which the necessary information could be obtained.
Possibly a good way of strengthening one's position in such a case as I am endeavouring to make out would be to give a few illustrations of what I think a committee of the nature' I suggest might do. I may astound some hon. gentlemen -in the House and possibly some members of the Government, when I state some of the problems which I think might very properly and very profitably be committed to the committee for inquiry and investigation. Take the Hudson Bay railway. I do not know if other hon. gentlemen have had the experience I have had in connection with this public undertaking, but I think in all my experience I have yet failed to meet a Canadian citizen who thought this project would be a success. Yet the two historic political parties of this country have, I think, approved the project. I am not saying it is inherently weak and destined to absolute failure, just because that has been my experience, but as far as I am concerned, I should hesitate to commit the country to the completion of that undertaking until I had further information about it. It has not yet been settled that the Hudson Bay route is a feasible or practicable shipping route. In

fact, the Hudson Bay port selected, is not now deemed by the former friends of the project to have been properly selected. The very successful export of a cargo of wheat from Vancouver a few weeks ago has also given to the Hudson Bay undertaking an altogether different colouring. I quite agree that it is futile to deliberate upon past mistakes, but something might still be saved if it were the judgment of Parliament and the country that the project should not go to completion. How are we to be informed upon the subject? I know of no other way, or of no better way, at least, than by committing the consideration of that question to a Parliamentary committee. I do not believe there is any other method which would so promptly and effectually develop public opinion one way or the other upon that question. I think that is a matter which might very properly be committed to a Parliamentary committee, which I believe could do splendid work in considering it.
I will give another illustration in which the people of my province and of the Maritime Provinces generally are much interested. I refer to the operations of the Canadian Government Merchant Marine. Parliament, of course, is cognizant of the fact that during the war the Canadian Government built a number of ships; it matters not what their number is, or their tonnage, or the motives which moved the Government to embark upon that policy. When the ships were constructed, it became necessary for the Government to adopt some method of operating them, and eventually they committed them to the Canadian National Railways for operation. That department did not seek the transfer of these ships; they were rather imposed upon them by the Government. I do not know that the Government is open to any criticism for so doing, but the Government have never formulated any definite and irrevocable policy as to the operation of these ships. Assigning them to the Canadian National Railways was only a temporary disposition of the matter. At the moment, I take it that the Government is free to vary their policy, established as I have indicated, and adopt a different policy, and if possible, a better policy. From maritime ports to-day, and also from American ports via our maritime ports, there are running four privately-owned steamship lines connecting with Newfoundland. These services have been built up in the course of years, after a great deal of trouble, risk, anxiety, and considerable investment of capital. All the require-
100J
ments of the Maritime Provinces and of the rest of Canada and of the ports of New York, Boston, and St. John's, Newfoundland, were fairly well satisfied with the shipping facilities provided by these four privately-owned services to which I have referred. Recently the Canadian Government Merchant Marine have placed in that service three or four boats. Those boats are losing a great deal of money in that service. There has been a curtailment of traffic. The privately-owned lines are also losing money.


Mr. BALLANTYNE:: May I ask my
hon. friend how he knows that the Canadian Government ships are losing money on that route?


Alexander Kenneth Maclean: I know positively that nothing else is possible than the loss of money by the boats of the Canadian Merchant Marine that are now engaged in that Newfoundland service. I say to my hon. friend that nothing else would be possible, and I am so informed by men who know the shipping business just as well as those who are operating the Merchant Marine.


Mr. CASGRAIN:: Or better.


Alexander Kenneth Maclean: I therefore accept it as a positive fact that my statement is correct and incontrovertible. But even if my hon. friend were right and I wrong, I submit it as a fair proposition that the Canadian Merchant Marine have no right to interfere with established companies who, in the course of years, have developed a service which is satisfactory to the people generally. It is unfair and unjust, and you cannot get the people of this country very long to support such a policy. These privately owned companies pay their taxes, and they are at the present time losing money. The Canadian Merchant Marine are losing money, and they ask the owners of these companies to help pay the deficit encountered in their operations. As a matter of sound policy, this is wrong, and it is not fair treatment to the people who are engaged in that service to-day. And I do not believe that the people of the country will take any different position from the one I have just stated in this connection.
However, it would be very difficult, I take it, for me to persuade hon. gentlemen on either side to abandon the present policy unless I were able to demonstrate conclusively the facts upon which I base my conclusions. I do not think that any mem-

ber of Parliament has the right to occupy the time of his fellow members and ask them to reach a conclusion unless he knows his subject and is able to demonstrate the soundness of the conclusion which he hopes to impress upon them. I can quite understand, if I ventured upon such a course in this Parliament, I might be questioned as to my facts, and I am not sure that I could obtain them very easily without the information available through a committee. If a committee were appointed with jurisdiction over the matter of shipping, I should be entitled, I assume, to summon before that committee the managers of the company and the owners of privately-owned companies operating in the particular area to which I referred a moment ago, to have the opinion of everybody, and a general exchange of views; and in the end, that committee, if composed of capable men, would be able to reach a very safe and sane conclusion. If their finding were a sound one, I feel sure it would be accepted by Parliament and by the Government. But I want to say to the Minister of Marine (Mr. Ballantyne), that I am referring only to one particular service; I am not urging that the whole fleet of the Canadian Merchant Marine should be withdrawn from service. I am sure, however, that a great many of these steamships might profitably be sold, particularly the smaller ones operating from eastern ports. It is far better, if you wish to develop commerce and have a successful merchant marine in this country, to dispose of these ships at favourable prices and on satisfactory terms as to payment, to Canadians, if they will take the ships, because the history of the world is abundantly clear that all commerce is after all developed by the initiative of private individuals and not by governments or by ships.


Alexander Kenneth Maclean: So are high rates for all kinds of transportation.


Alexander Kenneth Maclean: There is no possibility of excessive freight charges today, with ten million tons of shipping more than before the war, two and a-half million tons of shipping being idle in the British ports to-day, and one thousand ships laid up in American ports. In these circumstances it is unlikely that the world will lack competition in the future. But, I repeat, the point I want to make is that it is extremely foolish and unprofitable for the Government to be operating boats at a loss on routes which are amply served by existing fleets owned by private individuals.

I do not propose detaining the House by citing matters which I think a committee might very well inquire into. If hon. gentlemen will permit me, I should like, in fancy, to see the heads of the railway management before this committee, if it is established. What is more natural than that the committee should have before them the general manager to go over the annual financial statement and thoroughly explain it, and to have matters which have not been submitted to Parliament placed before them? Would any public interest suffer, or would the railways be prejudiced by an exposure of all relevant and important facts? Would it not aid in the development of sound public opinion on such matters if this were done? There can be no difficulty in convincing one that great benefit would accrue from a discussion of such subjects as capital expenditure, the necessary money required to be voted by Parliament annually for operation, the question of the re-valuation of some of the roads, the elimination of particular services, and the closing down, temporarily, perhaps, of certain sections of railway.
I do not say that this committee should formulate and attempt to dictate policy to the Government, to Parliament, or to the country. All I urge is that it should be the instrument for disclosing full information that is much needed, all of which would go to inform Parliament, to educate the country, and thus gradually to evolve a sound public policy. The other day a motion was made by the leader of the Opposition (Mr. Mackenzie King), in which it was suggested that a complete disclosure of all information should be made to Parliament. As I said on that occasion, it may be that there was much to be said against that motion. It might well be a fair matter to commit to this committee the task of working out some other method of giving to Parliament all important or necessary information and thus perhaps avoiding a needless waste of time, at the same time giving to every one whatever was really necessary. The objection has been urged upon me privately that this matter should be referred to a special committee and not to a standing committee. I am not irrevocable in my judgment upon this. I am not particularly wedded to a standing committee in preference to a select committee, but I wish to point out that this will be a standing issue for some years. I think there will be much that a committee might do for more than one session, and more than the lifetime of

this Parliament, and I believe, therefore, that it will be better that this vast subject, in so far as it is to be treated by parliamentary committees, be referred preferably to a standing committee rather than a select or special committee.
A reference of the issue to a special committee at the present moment would, I fear, develop contests and antagonisms, that would not promote really useful and informative inquiry into the railway question; the very suggestion of a special committee suggests a contest. It has also been suggested that the present railway committee would suffice for my purposes. In answer to that suggestion I say that committee is too large, and its history and traditions are against useful work, particularly of the nature that I have outlined as being proper work for this committee. It has been urged, I think by the leader of the Opposition, that this committee should only inquire into such matters as were referred to it by the Government. There may be something in that contention, but its accuracy could only be developed later. I should think that if this committee were appointed, there is very little that it might not inquire into. I would hope that it being a parliamentary committee, and not a government committee,- the House from time to time would exercise the power vested in it and refer to that committee anything which it desired to refer. I wish again to impress upon the House the fact that I desire this committee to be a parliamentary committee, not necessarily a committee for Government purposes.
It has also been intimated to me that the management of the National Railway system would object to the constitution of this committee. I can hardly understand such opposition coming from the management. I can hardly understand the mentality of responsible men who, in view of the general situation, would take that position. I am not sure that that is their view. If it is I can only say that in my judgment they lack a clear apprehension of the great task that is ahead of them and now before then. Does the Government imagine for one single moment that it can get this country committed to the policy of government ownership and government control for twenty-four months, or for twelve months, unless there is some method of keeping the country informed from time to time upon the issue? In prosperous days, with a railway earning its operating expenses and building up reserves, the public probably would be quiescent in the matter, and it
would take very little to satisfy them; but I want to tell my right hon. friend who leads the Government that his credulity is almost laughable if he thinks that the country will permit him to conduct the National Railway system under its present policy-and I am not at the moment criticizing it-with the vast amount of taxation that must be imposed upon the people, unless he creates some avenues by which the people can be informed, by which the management and the public can be kept in touch with each other, and by which Parliament may know, as much as anybody else, about this question. If the management of the railway think that they can perpetuate themselves there, and at the same time carry on their duties in the background, without any means of seeking public approval of their policies and administration from time to time, and keeping that public informed, then I say it is very evident indeed they do not understand the problem which confronts them and the seriousness of the railway situation. I venture the opinion, Mr. Speaker, that if the chief officers of the Canadian National railways were to appear before a parliamentary committee for about ten days during a session of Parliament they would do more to establish themselves with the public than they can do by any other means to which they may resort to inspire or to obtain public confidence. I do not mean, Mr. Speaker, that this committee should engage in an inquiry into, and a discussion upon, all the trivial details of railway operation. I can quite understand you could not get a capable and intelligent railway manager to head the management of any railway system, particularly of a large system like this, if he were to be the subject of daily discussion in Parliament and of attack, even before a parliamentary committee, upon small trifling matters; it is very desirable that we abstain from criticism of that nature. What I seek to do, is\ to afford the opportunity for the manage- !) ment meeting a committee of the Parliament of Canada who represent the people so that, sitting together, they might discuss all the important matters relating to the railway administration, and I suggest, Mr. Speaker, that only through a parliamentary committee can this be done.
I want to say further, Mr. Speaker, that I doubt very much if the opinion of the railway management is as has been represented.
I know it is not the opinion of all the important officers of the management. I do know that it is not the judgment of all the

nominated directors of the National system. I know that many of them feel that their position is absolutely untenable, and that the whole situation will break down unless some method is provided of bringing the management into contact with the public, unless some method be devised of putting the public into a sort of relationship with the management such as shareholders are in annually with the management of ordinary commercial concerns. I take very little stock, Mr. Speaker, in the suggestion that has been made to me several times that he management are against the proposal for a parliamentary committee. It is an untenable position to take, and I venture to prophesy that after the experience of one week before a parliamentary committee they would abandon that foolish position, if, at the present moment, they entertain it at all. But whether they do or not I say that if the management want to have the support of the public, and they do want the support of the public, some such proposal as this one of mine is necessary. There is no management alive to-day, no management procurable by the Government, which can manage a railway system unless it has the support, of a section at least, of public opinion, and it must also have the support of Parliament, or at least a very large section of it. Otherwise it would be absurd to occupy the time of hon. gentlemen in seeking to establish the possibility of its continuance.
I admit, Mr. Speaker, that my suggestion perhaps contemplates a commitment of powers to a parliamentary committee far greater than we have hitherto witnessed. I know that the British system of parliamentary government strongly maintains the principle that all power and responsibility rests with the government. That was strongly asserted several years ago, and text book writers have affirmed that principle throughout the years in any discussion upon the British system of parliamentary government. But it is true that in actual practice, even in Great Britain, very important matters are now being committed to parliamentary committees, and splendid work has been done by them. In the United States splendid work was done last year by the Senate committee, particularly in the preparation of what is now the United States Transportation Act of 1920-the Act which transferred the control of the railway systems from the Federal Control Act to the Act which I have just mentioned. As I say, splendid work was done there, and a peru-

sal of the prolonged inquiry of the Senate committee would repay almost anybody, because the problems with respect to railways in the United States were very much the same as they are in this country. If there is any other possible way of bringing about a connection between an interested tax-paying and share-holding public, and it is better than this parliamentary committee and more likely to secure the results we seek, I should very gladly accept the suggestion.
Just one word in reference to the size of the committee which, I understand, the Prime Minister has intimated that he will appoint. It seems to me that that committee should not be a very large one; at the same time, I do not think it should be a very small one. It may be presumptuous on my part to make any suggestions in the matter at all, but inasmuch as I have perhaps made some astounding suggestions- at least, the Prime Minister may think I have-I might add just one more to the list without increasing the enormity of my offence. There is no doubt in my mind that if the operation of our railways is to continue under what is now virtually Government direction, with little prospect of any extensive construction during the next year or two, indeed, with a paring down of maintenance to the very limit, interprovincial jealousies will develop. Already instances have been observable in the press. I mean that when services are being curtailed, when sections of railway perhaps are to be abandoned temporarily or permanently, there is a natural tendency among persons living in the localities affected to believe that the railway management or possibly the Government are acting in a partial way. Therefore, if the Prime Minister will permit me, I would suggest that the committee should number about twenty-five or thirty-five members, and that in its constitution some respect should be paid to provincial representation.
I am sorry, Mr. Speaker, that I have detained the House so long in presenting this matter, although I do not wish hon. members to think that I have exhausted the arguments that can be advanced in support of my motion. In fact, I doubt if I have given to the House the strongest reasons for the appointment of such a committee. However, I trust I have given such reasons as will induce the Government and the House to accept the suggestion which my motion contains. I move:
/That all words after "That" be struck out ad the folloing inserted in lieu thereof:

"Rule 10 of the House of Commons, relating to the appointment of the Select Standing Committees of the House, be amended for the present session by adding to the Select Standing Committees of the House for the present session a Select Standing Ooimimittee on Railways and Shipping owned, operated or controlled by the Government,1ifamd that the Special Committee appointed to'prepare and report the list of members to constitute the Standing Committees for the present session, be instruct. ed to prepare and report the list of members to compose the Select Standing Committee on [DOT]Railways and Shipping owned, operated or i controlled hy the Government' for the present j session."
' Mr. L. J. GAUTHIER (St. Hyacinthe-Rouville) : Mr. Speaker-


Georges Henri Boivin: Before the
hon. member speaks, it is the duty of the Chair to warn hon. members that an amendment having been proposed to the motion to go into supply, the discussion should, of course, be relevant to the amendment until the latter is voted on.


Mr. GAUTHIER:: Mr. Speaker, I have listened attentively to the address delivered , by my hon. friend, the senior member for Halifax (Mr. Maclean) and I must at once state that I am opposed to his motion, for many reasons. Everybody admits that our railway situation is a very distressing one, but that does not justify the hon. member's proposal for the formation of a committee which, if I have understood rightly his explanation, would be vested with more power than the House which had originated it.
There is another reason why I cannot agree with my hon. friend. He states that the tendency of modern times is to give all rights and powers to governments. I do not agree with him. Rights and powers belong to Parliament, and they are not to be surrendered to the Government; and surely we are not going to give away those rights and powers to a committee which will hear evidence, send for papers, and manage the road, and will then give Parliament whatever information it may see fit. We will not be any better off. The hon. member for Halifax says that his proposed committee will be subject to criticism. In other words, it will be taking the place of the Government, because the Government is charged with responsibility for the distressing condition of our railways, and under my hon. friend's suggestion this responsibility would be shouldered by the committee. I do not think the motion - should he entertained. Why? I believe, Sir, that we would do well on this very question to take a lesson from the labour movement. What is the reason of the
struggle between capital and labour? Labour contends that in every industry there should be a closed shop so as to eliminate competition in regulating the hours of work, the schedule of wages and the kind of work to be done. Every employee is looking for the acceptance of the closed shop idea, but my hon. friend is evidently desirous that the Canadian National Railways should be operated on the open shop system. I believe that the Canadian National Railway system has troubles enough without our adding to them by furnishing to a committee of twenty-five or thirty-five men information that may subsequently be secured by its competitors. If that is done, successful competition with other railways will be made very difficult.
My hon. friend has stated that the conditions as regards railways are the same elsewhere, and he has referred to the American railways. When the United States Government decided to conscript their sons they decided also to conscript the railways of the land. They controlled them for two years; they increased the rates to the amount of $750,000,000 each year, and they had a yearly deficit of $850,000,000. In the month of September last the railways were returned to their private owners, bait the United States Government gave to the owners $500,000,000 as a bonus, because of the fact that roadbeds had been deteriorated, rolling stock had not been replaced, and motive power was no longer efficient. The United States Government decided to appropriate $600,000,000 for the purpose of enabling the railways to reimburse themselves during a certain period for the loss they would have to incur in putting their roads on as sound and efficient a basis as that on which they had been operated before. But my hon. friend was badly advised in connection with the Transportation Act passed by the United States Senate. It is what is known in railway parlance as the Eseh-Cummins law. When the roads were given back to their private owners those in the United States who still believed in public ownership were responsible for the enactment of this law, providing that the bulk of railway securities should not return to the owners more than six per cent on the investment. That is why the railways on the other side of the line are in such distress. They cannot issue bonds for absorption by the public; when they did appeal to the public to absorb their securities they had to pay as high as seven, seven and one-half and eight per cent by way of

interest. When they make further issues of bonds they have to take into consideration the fact that the bulk of their securities must not carry more than six per cent. But notwithstanding this distressing condition there are six railways in the United States which are operating on a perfectly sound basis. For instance, when the Wabash system, which traverses part of Ontario, was given back to its owners in September, everybody versed in railway matters thought that it would have to go into the hands of a receiver. But there was appointed to the management of that road a man who knew how to direct its operations properly, and to-day the Wabash system is one of the six systems in the United States which is paying its way and which is putting aside every month an amount for equipment and maintainence which is necessary to the success of the railroad.
My hon. friend has stated that there is a difference between the Canadian Pacific railway and the Canadian Northern. I admit that there is a vast difference, but there has been a vast difference, too, in the management. In the course of my remarks I am going to give the reasons for that difference. Both these railways were put on the market by promoters. The promoters of the Canadian Pacific, however, after their preliminary work had been completed, put the road in the hands of expert managers, and the result was success. But in the case of the Canadian Northern, the promoters, having secured the construction of the railway, promoted the sale to the Government, and some believe they are now promoting the re-purchase of the system by them. If you will allow me, Sir, to give you the comment of the man on the street and to put it as I have heard it, it is this: the group of promoters of the Canadian Northern bled the country to build up their railways; they bled the country to sell their railway to the Government; they are bleeding the country through its operation, and they will again bleed the country when they re-purchase the road. Public opinion will not stand for that, as I shall prove before I am through with my remarks. The Government were compelled to take over 17,500 miles af railway, and they are waiting for the conclusion of the arbitration proceedings to take over the Grand Trunk. When they are attacked with regard to their policy of public ownership they turn on the Opposition and say: You are responsible; you built the National Transcontinental; you subsidized the [Mr. Gauthier.J
Grand Trunk; you subsidized the Canadian Northern; it is your fault. But the Liberal Opposition reply: You were wrong in taking over these railways; you should have let them go into the hands of a receiver. But to my mind, Mr. Speaker, public men have no desire to lose their prestige, their reputation, their good name. They do not wish to propound policies which will result in the destruction of the parties which they lead; they are actuated by a desire to do what is right, and to do it at the proper time. Take, for instance, the Liberal party. In 1904 there had been two or three adjustments of Federal subsidies to the provinces and the older provinces were still endeavouring to secure better terms. The authorities in Ottawa thought that the demands were reasonable but that if they were met, the Federal Government would be exposed to a series of raids on the public treasury. About the same time the new management of the Grand Trunk, under the guidance of the late Mr. Hays, decided to ask for subsidies in order that they might tap the prairie provinces and secure an outlet to the Pacific ocean. The Government of the day decided that they would link, together the appeal of the older provinces to secure better terms and the appeal of the Grand Trunk to get subsidies. Was that a wrong policy? Was the Government of the day composed of wilful wrong-doers? Not at all. This was at a time when two new provinces had been opened up on the prairies; it was at a time when an abundance of wealth was coming to this country, when an immense prosperity was flooding the country, and the men at the helm of the ship of state then decided that, at the same time as they were according better terms to the older provinces and as they were giving a favourable answer to the Grand Trunk, they would also answer the calls of the western population of Canada. What was the claim of the western population of Canada at that time? They said that the Canadian Pacific railway with its rolling stock was unable to take care of the needs of the western country; that the western country could not get service at proper rates. They were asking better service, competing lines, and the Government of the day decided to grant to the Grand Trunk subsidies to build the Grand Trunk Pacific, but on the understanding that the Grand Trunk would at the same time operate the National Transcontinental which was to be built with the

money of the people of this country. If you want to judge the action of the Liberal Government of 1904, you must go back to 1904. You cannot judge the decision and the action of that Government by the motives that you can impute to them in 1921. To do so would be unfair; it would be an injustice and you would be resorting to a policy of recriminations which would create a sentiment and feeling of unrest in the country. We are not here to say: "You are another." "I told you so." "Why did you not listen to me?" We are here to face problems as they come before us, without recrimination. If we want public men to be respected in the land, our first duty is to respect one another.
What was the argument of the Government in respect of their policy of public ownership? On account of the war, the railways were unable to meet their obligations, and the Government decided it was better to take over the railways and not to allow the companies to go into the hands of the receivers, because, otherwise, the credit of Canada would be hurt for all time to come in the money markets of the world. This is a sound reason; this is a reasonable argument; but there is more than that. The 'majority of the chamber were in favour of public ownership; they wanted to have this experiment, and
9 p.m. majorities rule in this House.
I have stated before, and I have no hesitation in stating again to-night, that I am opposed to public ownership, because I believe it kills individual incentive to better one's condition. As soon as you have public ownership, you are falling into routine, and you can have no proper management unless you are lucky enough to find somebody who will be sufficiently strong to do his duty to the utmost, and such conditions are very hard to find these days.
Anyway the situation as I see it is this. The railways were built by parliaments of former days; they were taken hold of by the late government. Now we are face to face with this situation. Are we going to say: "Well, we will try to becloud the issue?" You cannot becloud the issue. Last year the railways had a deficit of $48,000,000; this year they have a deficit of $70,000,000, and next year the deficit will run up to $100,000,000. You cannot becloud the issue; you must face it like business men and try to secure the real remedy for the evil. What else could you do? You cannot sell those railways. Nobody will buy them.
You cannot give them away for nothing. Nobody will take them. You cannot even give them away by paying somebody to take them. Everybody will be afraid of the expenditure. Are you going to sacrifice the money of the country? Are you going to let the railway deteriorate? Are you going to allow the rolling-stock to become obsolete as our locomotives are becoming obsolete? Are you going to let the motive-power, the rolling-stock, the road-bed, go to pieces? If that be the case, the deficits will be higher every year and you will never be able to dispose of the railways. You have the railways; manage them properly; keep them in the best of condition. If you are able to make a success of the business, all right; but if you can only make both ends meet, keep your railways in a state of efficiency, and when times are better, you will be able to dispose of them, regulating those railways by the Railway Commission, so that the people of this country will not have to pay rates which are prohibitive as the rates which we are paying now are. That is, to my mind, the only solution. We have, I admit, to face a tremendous problem; but are we going to say, after having gone on record for public ownership, that public ownership in the railway question is a hopeless task for Canada? You cannot do this unless you have given a fair trial to the experiment of public ownership of railways.
Who is responsible for the actual deficit because after all, if we had a surplus, I suppose the opponents of public ownership would not say much; I suppose we would not be looking for remedies if we had a surplus. We have a deficit. Who is responsible for that deficit? In railway management you have to take into consideration three factors-the management, the employees, and, in public ownership you have also to take into consideration the public. Of course, a privately-owned railway must also take the public into consideration, but under private ownership the public pays the rates and absorbs the securities issued by the railways. Under public ownership, the public pays the rates, and in our case, settles the deficits. Those are always the three factors, and they act accordingly.
Under public ownership you must have a management who can appeal to the employees. You must have a management that is founded on democracy; you must have a management that is not autocratic. Railway management under public owner-

ship must win the confidence of the employees. You cannot drive the employees by fear. The management must be respected by the employees, and when the public sees that the management is doing its best, that nothing is concealed, and that the operation of the road is successful, in its turn it also will have confidence in the management and in the employees. How can we expect the employees to have confidence in the present management of the road? They have been fighting each other since the beginning of public ownership. Actually, Sir, the Government through its management is paying every year an immense amount of money for freight which has been delivered to the Canadian National Railway system but which was never delivered again to the party to whom it was shipped. Things have gone so far, Sir, that the "Canadian Railroader," the official organ of the brotherhoods, is appealing to the employees to stop this pilfering of the freight trains. Can you blame the employees? They are doing what they see the management doing. If the management, after having had last year a deficit of $48,000,000, can come to this Parliament again this year with a deficit of $70,000,000, and still retain the confidence of the Government, what confidence do you think the employees can have in the management? More than that, if the management is permitted to manage the railway system in such a way as to compel the country to shoulder such huge expenditures and such excessive deficits, why should not the employees serve themselves while they have the opportunity? They do exactly as the ones above are doing, no more and no less. Do you believe, Mr. Speaker, that with a management of that kind we can make a success of public ownership? Mind you, I have gone on record, and I am not going to repeat myself. If I was only looking for political profit I would not say a word, but under democratic government, I believe in the majority ruling. The majority have asked for public ownership in railways. Give them public ownership, but do not kill, public ownership, and do not kill the hopes of the men who believe in public ownership. I say it is the duty of the Government to change that. If the employees have no confidence in the management, how can the people have confidence in their public-owned railway? It is a failure. From one end of the country to the other newspapers are telling their readers that it is impossible to make a success of railway management under pub-
lie ownership in this country, until now the people have lost confidence in public ownership. I believe that for the sake of the country-I have no right to ask the Government to do it for their own sake- the Government should change these conditions, and they cannot change them too soon, for not only is the Government going to suffer in the general dislocation, but the country is going to be ruined, and the country will not stand for that.
The management, I charge, is actually responsible for the situation of our railways. The road is managed by a gentleman who all his life has been affiliated with the group of promoters who promoted the Canadian Northern Railway, with its 65 subsidiary companies. Ordinarily, under railway management there is a main line, with feeders. The feeders help to swell the revenues of the main line. With the Canadian Northern, the feeders were only feeding the promoters; they never fed the main line. Conditions are the same to-day; even if they are not, people believe they are, and that is just as bad as if they were. When people look at the deficits on our national roads they will continue to believe that the feeders do not feed the main line; at any rate, they do not feed the coffers of the system.
Promoters cannot be railway managers. Promotion is an art, and railway management is a science. The promoter is looking for a quick turnover. He appeals to the schemers, the plungers, and the get-rich-quick people. But railway management is a science, and the scientific manager looks ahead for the application of principles which have been taught by experience. There is no comparison at all between the two. Promoters cannot manage. They can continue to promote, and they are actually promoting yearly deficits. But enough of that.
With the permission of the House I will speak in a single sentence my own mind on this question. Once a promoter, always a promoter. I say if the Government keep on with the present management of the Canadian National Railway system their responsibility will be very great. They are shattering the hopes of all those who believe that with competition in this country we can have better service with adequate rates. That will be impossible if the management remains in the hands of those who are actually managing our railway system. According to Mr. A. B. Johnston, the President of the Railway Association in the United States, " Transportation is a busi-

ness; it is the business of business men to put the transportation business on a business basis." I shall do my .best to discuss the situation as one who would like to be a business man, who has studied this question with all his modest ability, and who is willing, whether his ideas prevail or not, to give them to the House with the satisfaction of having done his duty.
The management of every railway ought to replace without delay the obsolete locomotives that lie around every railway system on this continent. According to the figures which I have, there are on this continent more than 20,000 obsolete locomotives which cannot be consigned to the scrap-heap for the reason that at present they cannot be replaced. To build a modern locomotive today requires from $50,000 to $55,000; that is, if the figures I have been able to procure are correct. The technical experts on the railways in the United States, finding that they were unable to secure, by the issuing of bonds, the necessary funds to replace their present motive power, have devised means by which an obsolete locomotive, which to-day can draw only one-fourth of a regular haul, will, when remodelled, do the work of an engine that has cost $50,000 to $55,000. Now, this is no experiment; it has been accomplished in one of the eastern railways in the United States. The remodelling costs something like $22,000, and it converts an out-of-date locomotive into one of the most powerful engines on the road. The railways should have in their yards and in their shops proper scientific tools and equipment. I admit that the war is responsible for the fact that the railway shops are not equipped to do this kind of work; but if the railway companies would let contracts to the companies that remodel obsolete engines, I have no doubt that these concerns would be glad to do the work at practically half what it is costing the railways to carry on with their present rolling stock. If contracts were let for remodelling the locomotives that are in use now, within a few years the Canadian railways would have highly efficient motive power. But motive power is not the only question to be considered; I think that a scientific management should also see to the reduction of grades and curves.
Now, Mr. Speaker, the question of competition is a very interesting one. Railway experts assert that the troubles in connection with the present railway situation on this continent are due chiefly to duplication of tracks; but it seems to me that our Canadian railway concerns, in face of the
unwisdom and the loss resulting from such duplication, are fostering this disease. It is a useless expenditure to have trains running practically alongside of one another, consuming fuel and paying wages to double crews. Under a scientific and proper management, many trains would be eliminated, and, with proper motive power, freight trains could be hauled with more tonnage and fewer employees. But, Sir, when the railway management have to face employees as well as Parliament, they are afraid to act, and while they are in a state of indecision, deficits are piling up every year. An important question, Mr. Speaker, is that of terminals. For the railway management as well as for the travelling public, I suggest that the same terminals should be used as far as possible by different lines, taking care, of course, not to prejudice the traffic of the owners of any terminal.
The question of letting contracts for rolling stock is to my mind one of the most important and most serious. Whenever the Canadian National Railways want rolling stock or motive power, they virtually advertise in advance through the appropriations voted in Parliament. Those who supply raw material, as well as the labourers, know that the management will be in the market; and the Canadian Pacific Railway, the only competitor our national railways have, are thereby given an advantage which they would not have in the case of a private competitor. If the Canadian Pacific Railway wanted to secure an appropriation for any purpose, they would get it at a meeting of the shareholders. But when a vote is made in Parliament for the Canadian National Railways for the purpose of securing motive power or rolling stock, their competitor-and I know this of my personal knowledge-immediately enters the market. What is their object in doing that? They are in the market to boost prices and not with any intention of letting contracts; and the prices of raw material having been boosted up, the Canadian National Railways pay more for their rolling stock than they should if they were properly managed. I was reading in one of the papers of Montreal yesterday that the Canada Car Company have no orders from the Government, although they know that the Government will soon be in the market to purchase rolling stock. Look at the National Steel Car Company. They have contracts for just three or four months in the year, and the labour men, knowing that they will have only three or four months' work, necessarily increase

their demands. The owners of dwellings also, knowing that their houses will be occupied only for three or four months, raise their rents; and the tradesmen in the vicinity, apt to be left with an immense stock on their shelves, naturally charge higher prices. So that the labour men have nothing to do but demand higher wages, because they have to pay higher rent and greater prices for the goods they buy. But there is something worse: the labouring man, working only three or four months in the year, loses a part of his efficiency and the Canadian National Railway system pays higher for its rolling stock.
May I be permitted, Sir, to place on Hansard the official figures of the rolling stock and motive power which were contracted for by the American and Canadian railways in 1920: locomotives 1,770, the cost amounting to $106,000,000. Passenger cars 997, at a cost of $23,000,000. Freight cars 73,593, the cost amounting to $221,000,000 making a grand total of $350,000,000. The Canadian National Railway system is paying for a share of this rolling stock and motive power, and I believe that it is time to have a system, a scientific system, which will do away with lots of the waste from which the national railways annually suffer; the management, to my mind, should try to secure the greatest efficiency combined with the strictest economy.
May I be permitted, Sir, to call the attention of the House to an experiment entered into by the large railway known as the Pennsylvania Railway system? When that railway was given back to its private owners there had been such a large expenditure, and such an immense amount of patronage, under public ownership, that in the first month after the resumption of private ownership the management of the road released from employment 15,000 men. There was trouble all over the line, but the management of the Pennsylvania appealed to the men. They told the men that they were looked upon as partners. The men were given committees of their own with equal representation with the management; and every month, all over the line, sub-committees are having their regular sittings. Every discussion is open, every question is settled; and when this joint committee has, by a vote of two-thirds, reached a conclusion, the matter is settled once for all over the entire Pennsylvania system. Sir, every newspaper in the United States has acclaimed this ex-

periment, saying that owing to this plan there will be no more strikes on the Pennsylvania system. I wish hon. members to keep this experiment of the Pennsylvania railroad in mind because I want to use it as an illustration in connection with the proposal which I would have submitted to the House had I not decided to speak on the motion of my hon. friend the senior member for Halifax (Mr. Maclean). But being unable to present this resolution as I had contemplated, and calling ior a vote on it, I will embody in my remarks all that the resolution contains, and this will be my contribution towards the endeavour to settle the vexing problem of our railways in Canada. I believe, Sir, that with proper handling the employees of the Canadian National Railway system might be taught that the McAdoo schedule and the Chicago agreement are unable to solve the problem as far as they are concerned. The McAdoo schedule of rates was launched on the eve of a presidential campaign in the United States. It was designed for a political purpose, but, Sir, it has created a situation which, in wages alone, has increased the pay-roll of the railways of America from $1,500,000,000 to $3,600,000,000 inside of four years. The employees using the McAdoo schedule went into convention and they adopted what is called the Chicago agreement. I shall give to the House a few instances of the effect of this agreement, and then hon. members will understand, I am sure, why the railway situation in the United States, as well as in Canada, is in a very distressing state. With the closed shop and the Chicago agreement, which are two different things, the labour element have adopted a policy which can thus be summed up: the least work done by each man means more work which will have to be done by others. Now let us see what has been the result of the Chicago agreement as recorded in the proceedings of the recent United States Railway Board which met in Chicago:
The 'Pere Marquette Railway was compelled to pay $9,364 in hack pay to four pump employees because their titles under these agreements were changed by a decision of the Director General.
A car repairer on the Virginian Railway was paid $1,000 for work he never did. He was laid off with other employees because there was no work for him to do. When he became entitled under his ''seniority rights" to be re-employed, he received back pay and overtime.
There are instances, Sir, where men, without working but because they were protected by the closed shop system and because they were influenced by the Chicago

agreement, have made raids on the treasuries of American railways. When these railways were operated by the government the patronage curse helped the employees along; but now that the railways in the United States have been handed back to their private owners the latter cannot stand for such doings; and surely, Sir, when private owners are unable to subscribe to the demands of the employees because they are excessive, the men, if they were properly talked to, ought to understand what is best in their own interests- surely they would obey and would follow the course which reason dictates? But actually, Sir, you cannot have that-it is impossible. The management is spending money and the employees want to spend just as much as the management is spending. .
Sir, if I were permitted to occupy a few more minutes of the time of the House I would say that the remedy of our railway situation is this: you must take into consideration that in running railways there is the mechanical operation, and there is the technical operation. The mechanical operation in my opinion should be attended to by the employees, and they should be given proper representation on the commission. I cannot admit, Sir, that the right hon. gentleman who leads the Government can hope to make a success of our railways when those who are supposed to have the general management have not been to Toronto for twelve, fifteen or eighteen months or even two years. They cannot be held responsible, for they have never been trained for that work. They have not got even a smattering of the science of railroading. The sole management of the road is in the hands of one man, and in this man the country has no confidence whatever. If I may give good advice to the Prime Minister, I would say to him: Do away immediately with the present commission and substitute for it a commission of mechanical and technical experts. Have three men to look after the mechanical operation of the road; secure the services of three technical experts in equipment, maintenance and operation; have two purchasing experts, and appoint as chairman an expert railway manager vested with the fullest authority. Above all, Sir, to give confidence to the public have the books of this Canadian National Railway system audited by the Auditor General of Canada. He is not an employee of the Government; he is an employee of Parliament, and he has the confidence of
the country. It may be objected that he will have to increase his staff. Well, let him increase it. Surely the auditors who are at present auditing the books must have increased their staff to look after this work, and it is just as well that it should be done under the guidance of the Auditor General. Then, Sir, in order that the idea of public ownership which was responsible for taking over this system may be maintained, the books after being audited by the Auditor General should on request of the members of this House, with the consent of the manager of the system and with the acquiescence of the Government, be brought before Parliament so that the country may see there is nothing to conceal. In that way you will restore public confidence.
Some hon. members are trying to make political capital out of this railway situation. I say it is too big and too distressing a problem to be so treated. Let us face it as business men. Let us appeal to the scientific railroad men who on the other side of the line have been able since last September to restore six of those roads from the verge of bankruptcy to a sound paying basis. "Oh," some hon. gentlemen will say, "Do not let us go outside of Canada for help." Sir, let me cite the example of the shareholders of the Grand Trunk, who were pretty nearly all Britishers living in Great Britain. They were tired of seeing the continued deficits of the Grand Trunk, and they went to Mr. Hays in southern California and hired him for five years, at an immense salary for that time, to rehabilitate the system. He came to Montreal with a full staff of technical experts and was given complete control of the road. What was the result? For the first time in the history of the Grand Trunk a dividend was paid on all its stock. It was worth while for the shareholders to engage Mr. Hays. And I say it is worth while for this country, if we are to make a success of public ownership, to take similar action, and if after doing so we are unable to make a success of it, then those who come after us will say that when Parliament decided to take over our railways it did not know its business and was unable to tackle a job which in the sequel was a hopeless task from the outset.


Arthur Meighen: Mr. Speaker, I wish to express my appreciation of the considerate and impartial manner in which the mover of the amendment (Mr. Maclean, Halifax) presented his case, and as well of the incisive,

forceful and well informed style of the hon. member who succeeded him on the floor (Mr. Gauthier). The amendment before the House by way of amendment calls merely for the appointment of a standing committee, and it is the amendment, of course, which is before us for consideration. It is before us for consideration in the same way and with as great thoroughness as if the judgment of Parliament were to be obtained upon it, notwithstanding the fact that the hon. member who moved the motion was fair enough to see and to state that, inasmuch as the general attitude of the Government towards it had been made known, while it appeared on the Order Paper as an ordinary motion he did not feel that it should be pressed to a conclusion by way of amendment to Supply.
Coming then before the House as a motion for a standing committee for this session, it is, I think, my duty to state with more definiteness and completeness than was necessary on a previous occasion what the position of the Government is with regard to the suggestion it contains. I agree wholly with the hon. member from St. Hyacinthe that the hopes entertained by the hon. member for Halifax as to what can be achieved by the mere launching of a committee of this House are rather chimerical and extravagant. Nevertheless, it occurred to me on my first study of the motion when it appeared on the Order Paper that it would be worth while to extend to a committee of Parliament the duty of studying some of the concrete phases of this railway question. Indeed, it must have occurred to many hon. members that some method should be found for spreading a little wider the heavy burden that more and more devolves upon us as the Parliament of Canada and for endeavouring to secure from hon. members what they are capable of doing through the instrumentality of committees. I am quite aware that in doing so care must be taken that no attempt is made on the one hand to delegate to a committee what it is the duty of Parliament as a whole to itself consider and decide upon, nor on the other hand to detract from the essential responsibility of the Government for the initiation of policy. Perhaps I may first refer to the general railway situation which naturally in this debate is before us to some extent. I am free to say that the results of operation, in so far as they are reflected in the financial returns, are not altogether what we would like to see. The deficit this year is very substantial; the deficit last year was substantial. There [Mr. Meigtoen.j
are special reasons why that deficit exists- reasons so powerful that I do not think any hon. member who studied the subject thoroughly could have reasonably expected that no deficit would appear. At the same time I do not think the whole outlook is anything like so appalling or so discouraging as seems to be indicated by both hon. members who have just spoken and by some in the House and out of it who have already given expression to their views.
It must be recalled, first of all,-and this among other facts was brought to the attention of the House in the statement of the Minister of Railways (Mr. Reid)-that there was considerable arrearage to make up in the way of additions to the scale of pay extending over a period of time that was not covered by the increase in rates which was intended by thq Railway Commission to apply thereto. A very considerable share of the deficit, at least of the increase in the deficit, is attributable to that cause. Other causes might be looked to, but a more appropriate time will come when the details of the figures may be inquired into by this House. But looking by and large at the whole problem, it is by no means surprising that we in Canada should find ourselves at this time with railway difficulties of considerable magnitude to overcome. Now, why is that the case?
It is the case fundamentally and in the most important degree for this reason: as the result of conditions that are universal, every country in civilization to-day has railway difficulties of great magnitude to surmount. The mover of the resolution referred to the United States and also to England, and the hon. member for St. Hyacinthe brought forward most significant facts in respect to railway conditions in the United States to apprise the House of how tremendous is the problem that that republic confronts. Correspondingly great is the difficulty in which England finds herself in this regard. The reasons are not far to seek. During the progress of the war there was in both countries a mobilization of the railways under state control. The state undertook for the first time the handling of the traffic of the country. They were making an experiment, and naturally in the first years of the trial there would not be expected the same success that experience would bring about. May I remark in passing that I do not think there is a railway expert in any of the other countries engaged in the war who would not readily concede that in this country the

problem of handling the traffic was more thoroughly solved than it was in the United States, in England-indeed, in any nation of considerable importance. We had during the war most excellent traffic conditions in Canada; we had none of the most serious congestions which both in England and in the United States, more particularly in the United States, were encountered. In addition to the fact that there is a burden to be carried by reason of the struggle through the first years of Government operation on the part of these countries, railway wages and costs of material have advanced in these years at an unprecedented pace. The long series of McAdoo awards in the United States and of corresponding awards in England and in Canada has added tremendously to the burden of the railways and the cost of materials has also added to it, though not to the same extent. But both have put upon railway operation burdens that could not in the nature of things be compensated for by the increase in rates. You may increase rates to a certain degree and, as you "go up, increase the returns of the road, but there is a point beyond which you cannot go; there is an elevation beyond which you cannot go and get any corresponding returns. There was, in a word, nothing to compensate in toto, or nearly so, in the way of increase in return due to elevation of rates, for the tremendous advance in labour and material costs. That was a universal condition.
Now, it would not be strange if in Canada we had something of an exceptional burden, a burden additional to that shared in common by other countries enjoying transportation conditions similar to ours. I do not know, though, that our burden is so very much greater proportionately. I do not know that the problem in the United States, proportionate to their population and their strength, is not to-day just as vast as ours. Surely the figures given by the member for Halifax and the member for St. Hyacinthe indicate that the financial burden they must surmount in that country this year and next year is fairly comparable in proportion to population with that which we must overtake. But I say that it would not be strange if we had something exceptional in this country. And why? In the first place, we have a country of tremendous extent. We have a large area, and the larger the area of a country proportionate to its population, the greater must be its railway burden and the more it must cost to transport
the goods of that country. Consequently, it is only reasonable to suppose that until our population bears a higher proportion to our area we are probably going to have a bigger railway problem in this country than other countries have. It is only fair to bear that fact in mind in reflecting on the strength of the next point that I hope to make.
As I set about to state the next reason why we might expect to have an exceptional railway problem in Canada, I hope I shall be able to do so without seeking to make party capital out of it in any way. It does not matter to whom it is attributable. I have my own opinion as to whom it is attributable; others may have theirs. But that is not the point for the moment. The fact is that in this country we did anticipate unreasonably the railway needs of Canada and we did build prematurely so far as transcontinental lines go. By how many years, no man can estimate; by ten years, by twenty, possibly by thirty. But the fewer we can make it, the better. It should be the effort of every good Canadian and every public man who understands his duty to help make that period of years just as short as possible. I for one am by no means discouraged. I am more hopeful to-day than I have been for a long time that there will be no need of railway deficits in the course of some years; that we shall overtake the time when the mileage now constructed in this country may be used to advantage and when these great railway enterprises entered into in great degree for the purpose of opening up the country and for political purposes-honourable and high political purposes, too, some of them-when these railway enterprises will reach the stage when they are business enterprises as well. We are in the process of arriving at that point and all the efforts of this Parliament will be needed to hasten it. But struggle as we may we shall not reach that end for some time; we cannot in the nature of things reach for a few years at least the time when the railways now gathered into the Government system, built as they were for other than business purposes- that is to say, as investments that would be expected to bear a dividend within a reasonable time-will become business enterprises as well as political ventures.
It surely must be concluded that the present railway situation need cause no surprise, nor need it necessarily be attributable to faults of management. There may be faults, but that is not the issue in this

debate. Further, it need not be attributable to the fault of the system. The management doubtless has faults. Every management has faults. The system doubtless has faults. Every system has faults. But I do not know of any other system that could have been adopted in the railway impasse which existed in Canada than a Government-operated system. If anyone can point the way or can stand back two or three or four years behind the present time and from there point the way of any other system that could have been followed, I should like to hear it. I do not think there was any system open to adoption at that time, or that there is now, other than the system we adopted. It may be that the construction of the method of management might be improved. I am not prepared to discuss that point now; but, at all events, it does not necessarily follow that, because there are large deficits in operation, larger than those of last year, and the deficits of last year larger than those of the year before, the principle of management is wrong; nor does it follow from that alone that the method of construction of the corporation and the devolution of responsibility in the corporation is wrong. Much less does it follow that Government-operation in itself is unsound. So much by way of general comment on the railway situation.
I come now to a more specific discussion of the resolution and of what, in my judgment, might be expected of and delegated to a special committee of this House. The hon. member who moved the motion, the senior hon. member for Halifax (Mr. Maclean), emphasized the necessity for greater information, both on the part of members of Parliament and the country, as to fundamental railway facts of Canada. I would be only too glad if some practicable step could be taken by this House to spread wider the truth as regards our railways; in a word, better to inform the Canadian public. That would be a high and honourable object to seek. The hon. member thinks also that the committee could be instrumental in forming a liaison, a connection of some kind, between the railways and the public. I do not know that I have made any particular study of the functions of special or standing committees in relation to parliament; but if my experience is worth anything, it would lead to this conclusion, that you can scarcely make too concrete and definite the duties delegated to a special committee. The hon. member who moved the motion has

been in this House for many years; he has sat on many committees, and I did not hear him make any favourable comment on the competency or value of any special committee. Indeed, he took care to say that the Railway Committee of Parliament, which, perhaps, is the most important committee that we have, is historically unfitted for* such a task as he has in mind for this special committee. I do not know of any special reason why this should be so;
but why is it that we delegate 10 p.m. specifically duties to other committees, but that we should give this .special committee almost unlimited powers and expect it in some roving commission style to do the impossible? The hon. member seems to have in mind that if we can just appoint a special committee of Parliament and throw the doors wide open on all sides and the windows open above and around, that committee is going to settle all troubles under the sun. It will settle the question, say, of what branch lines shall be built; it will settle the question of railway rates. He discussed that at some length, although that question is committed to the charge of a body of experts known as the Railway Commission. It will settle the question whether the Hudson Bay railway shall be completed. It will settle the question whether a set of steamers running in our Mercantile Marine between Halifax and Newfoundland shall be continued on that route, and if they shall not be continued, what we had better do with the steamers. After it has done that, it will become a sort of educational institution to inform the whole Canadian public about our railways, a sort of college, university, and correspondence school combined. Really, I do not see how a committee of Parliament could ever perform functions so extensive. Nor do I think that, sitting here as members of this House, debating a resolution, we are very likely to be able to, determine in the best and most careful way just what it would be wise for a Standing Committee of Parliament on National Railways and Shipping to undertake. It is of the utmost importance that if a standing committee is to be created- and it seems to me well to create it for specific purposes that I will come to in a moment-and if it is to be continued as a standing committee, its powers, duties and responsibilities should be carefully and thoroughly thought out and committed to that committee in such form that it will know exactly what it is expected to do, what service it is expected to render to

the House and, therefore, it will address itself to its task with the intention of really getting it done well. Consequently, I intend to set out what I think Parliament might well charge such a committee with, and included in that will be the task of studying and determining for recommendation to Parliament whether the committee could, for useful purposes, be continued, and if so, what those purposes should be.
In discussing a subject akin to this about a week ago in this House, I said that Parliament might well consider whether or not the committee should be charged with the duty of studying out the much discussed problem how on the one hand Parliament can be kept informed of all facts connected with the railways and their operation, the shipping and its operation, all facts that Parliament should be kept apprised of in order that Parliament may, with all the light that can be shed upon the subject, determine questions of policy as to both railways and shipping, and how, on the other hand, that can he done without exposing the management to such conditions of operation as make efficiency impossible. That is a real problem. It is something of which, if a committee can work out and frame and recommend to Parliament a solution, that committee will be discharging a real duty to this Parliament and rendering a real service to the country. I believe it can be done; I believe it must be done; and I think it will be done. We must find a method by which necessary facts, that Parliament must have brought out as to operation and everything else connected with the railways and shipping, may be made known to Parliament, and at the same time that this may be done without so shackling and restraining the operations of the road as to make business operation by a board of directors an impossibility. Unless there are restrictions-at least as to operations under way or very recent-unless conditions are imposed, unless something is done that will not expose the management from day to day to such disclosure in this House of its every [DOT]act for the benefit of the individual here or the individual there or its competitor all over the country, or for the benefit of some political party, or of a political candidate here or a political candidate there-unless something is done so that the facts can be made known without those results, we may just as well give up for all time the possibility of a business management of the national railways of Canada.
I would like to ask, is there a director of that road who would suggest that such day to day disclosures can be contemplated? I know the management would never suggest it, and I believe, and firmly believe, that no man and no set of men capable of consideration for the management of a tremendous enterprise and responsibility of that kind could be secured to undertake the task if there was no restraint in that regard. Therefore, if that is committed to the committee, and the committee is empowered to secure every fact necessary for its determination on that policy, it is a task such a committee may well engage upon, and it ' would be an honour to any committee to be able to come to Parliament with a practical solution of the problem.
Furthermore, and this also has been referred to by previous speakers, there may be some question-I do not know whether there should be or not-as to whether the system of auditing that is now followed in respect of the operation of the national railways and shipping can be improved, whether it would be possible to have it done under the Auditor General, subject to his responsibility. I am not going to say whether a change would be better or whether it would not. I know there are very, very strong opinions that it would be impracticable to have it so done. But I think the committee might very well inquire [DOT]-and the Auditor General could be a witness and anybody else that the committee wanted to give evidence on that point could be a witness-whether the system of auditing could be improved upon, and included in that is the question whether the auditing should be under the responsibility of the Auditor General or not, or perhaps jointly, or perhaps on the responsibility of a firm designated for the purpose subject to the ultimate responsibility of the Auditor General. That question might well be looked into.
Then I have heard it suggested that there might well be more detailed information as to the operation of the road appearing in the annual report than it is customary for ordinary railway corporations to embody in the annual report to their shareholders. So far the management of the road include in their annual report only what ordinarily is given by a corporation to its shareholders; such as the Canadian Pacific Railway, for example, gives to its shareholders. It has been suggested that under the speciai conditions appertaining to Government operation, it should be possible and would be desirable that more detailed information



be given in the annual report of the Canadian National Railways. That question might also be considered by the committee.
Then there would be the further subject for deliberation as to whether it would be well to establish this committee as a permanent standing committee, such as the Railway Committee, the Public Accounts Committee, the Banking and Commerce Committee, and if so, for what purposes it should be continued, that is, what should be its duties as a permanent committee. That subject also might well come under review. . review.
I have merely outlined in brief what have occurred to me as proper subjects for the deliberation of the committee. I am not going to say that nothing else could be submitted to them. It might be conceivable that the general question of the devolution of responsibility within the managing body might also come up for consideration there. I have no comment to offer upon that suggestion. It can be reviewed when the motion that I shall give notice of to-night comes up for discussion. At present I am convinced that the four topics that I have hastily referred to might well be committed for consideration and report, and I am most thoroughly persuaded that if the committee addresses itself for the rest of this session to the review of those four concrete, distinct, and most vitally important questions, it will perform a service so great that it will not likely be hunting for other worlds to conquer.
There is one thing perhaps I should say, and it was suggested by a remark, I think, of the hon. member for St. Hyacinthe (Mr. Gauthier). It must never be thought that we should give to a committee powers or duties exceeding those we ourselves are ready to exercise. For example, if it is not in the interests of the country that we so hamper the management of the road as to render efficiency impossible by doing in this House what this House decided some few days ago it would not do, namely, bring out merely upon question or motion all information, no matter what it is; if that is not going to be done by Parliament, then Parliament is certainly not going to commit to a committee the power to do what in the public interest it is not right for Parliament to do itself. That could not be considered at all.
It was suggested in the debate, and I must say the suggestion was surrounded with uncertainty to me-I could not tell just what was intended by it-that if the word "Confidential" were used in respect

to papers and documents that should not be produced, that would solve the whole problem, but the explanation of the word "Confidential" given by the senior member for Halifax (Mr. Maclean) was such that if it meant what he said, then the whole idea meant nothing at all. It would simply mean that there should be brought down in this House such documents as the Government thought it was in the interests of the country to bring down. With the idea so vague as that, I think it' would be well to commit to the committee this question, and not leave it to the deliberation and decision of the Government in each individual case. That is impossible. Let us commit to the committee the decision as to what line of information, perhaps complete, if at the proper time should be brought down, and the conditions under which it should come down, in order that Parliament may be put in possession of verything that Parliament should have to determine policy in relation to the railways and in relation to shipping. In the word "policy" I include finance.
I think it is wise just to repeat in one sentence my suggestion: That to a committee there be given the duty of inquiring into and reporting to this House on the four subjects I have outlined, and that one of these four subjects should be the working out with care and thoroughness what the powers and duties of that committee should be should its existence as a permanent standing committee be recommended to this House.


William Lyon Mackenzie King: I should like to asic
my right hon. friend one or two questions before commenting on what he has said. Would he regard it as appropriate that there should be referred to the committee to which he 'has made reference the report of the Board of Directors-that the committee might consider any matter that is dealt with in that report?


Arthur Meighen: I would consider it
right that the report of the Board of Directors should be referred to the committee. The committee, of course, would consider it for the purpose of giving a decision on the subjects referred to it.


William Lyon Mackenzie King: What I am anxious to know is whether my right hon. friend thinks it would be proper for the committee to ask for information with respect to any matters that were suggested by that report?


Arthur Meighen: Certainly, with a view
to determining its decision on the duties committed to it.


William Lyon Mackenzie King: I am not
concerned about the committee's powers to determine what its duties will be. The point I am after is the power of the committee to secure information, facts, and answers to questions. Now, the report of the Board of Directors would deal with a number of matters pertaining to railway management, control, and operation, and it would naturally suggest a number of questions. What I should like to know is this: Would that committee have the power to get from the management answers to any questions which its members might wish to put with respect to any of these matters?


Arthur Meighen: If the hon. gentleman is not concerned with the duties of the committee, I am afraid there is not very much purpose in his question. The committee would necessarily direct all its efforts to the performance of its duties, and if it considered that any facts as to management were essential to enable it to determine these questions, it would have it within its powers to demand those facts.


William Lyon Mackenzie King: I am afraid that the replies of my right hon. friend are somewhat vague and evasive.


Arthur Meighen: Not at all.


William Lyon Mackenzie King: I will not say I think he purposely wishes them to be so, but if I understand the tenour of his remarks, they mean that this is a committee essentially for the study of what powers a body of the kind should have. I desire to know whether or not I am right in viewing the remarks of my right hon. friend in that way.


Arthur Meighen: It is not a committee for the study of what powers it should have. That is only one question. I very clearly outlined four. The committee would be entitled to any information which it thought was necessary in order to enable it to come to a decision. I cannot answer more clearly than that, and, as we are not in committee, I think we should proceed with the debate.


William Lyon Mackenzie King: I am prepared to proceed with the debate. Permit me, Mr. Speaker, to remind the House that the circumstance which occasioned this particular debate was a motion which was
introduced a few days ago on going into Supply, in which we on this side of the House asked the Government to supply Parliament with information with respect to matters pertaining to the operation, management, and control of the Canadian National Railways; averring in this connection that the Government should be responsible to Parliament in the giving of information and accounting for public expenditures, so far as the Canadian National Railways and the Railway Department are concerned, in the same way as in respect to any department of government. We were told at the time that it was impossible for the Government to give us information in answer to questions asked in Parliament, and further, that it was impossible for the Government to give information by way of orders for the production of papers and documents asked for. Speaking broadly, there are only three possible avenues whereby Parliament can be informed with regard to the administration of public matters: one, answers to questions asked of the ministry; another, the production of papers; and the third, through some committee of Parliament which has power to obtain information and report upon the same to Parliament.
Having been denied the first two sources of information, we naturally expected, when my hon. friend, the member for Halifax (Mr. Maclean), had upon the Order Paper a resolution to the effect that Rule 10 of the House should be amended so as to establish a Select Standing Committee on Railways and Shipping, and when it was intimated by my right hon. friend the Prime Minister (Mr. Meighen), that in all probability the Government would accept something at least equivalent to what the hon. member had proposed, that we were to have at least one avenue whereby it would be possible for the people's representatives in Parliament to receive information in regard to matters appertaining to the control, operation and management of the Canadian National Railways. Instead of that, after listening to my right hon. friend this evening, we are now led to believe that all that the Government proposes is to appoint a committee for the purpose of studying and determining, for recommendation to Parliament, certain questions. That is an entirely different proposal from the one in which we are interested. What this Parliament wishes to obtain is information that will enable the public to understand, among other

things, how it is that a deficit occurred the year before last of ,$48,000,000 on these railways under Government management; how it is that that deficit was $70,000,000 Lor the past year; and how it is that in all probability it will be $100,000,000 for the present year. These are vast sums of public money which the people of the country have to provide by way of taxation, and the people will demand that the Government, in one form or another, shall he responsible for the accounting of every cent so spent, no matter whether it is paid out under some Board of Directors which the Government themselves may constitute, or paid out by a Government department direct.
Allow me Mr. Speaker, to draw the attention of the House to an important fact: Last year, when my hon. friend the Minister of Railways, made his statement to Parliament and announced, with surprise at that time, the enormous deficit of $48,000,000, we on this side naturally immediately asked for information that would help to explain that deficit. My hon. friend was quick in assuring us that as soon as the report of the Board of Directors of the National Railways was laid on the Table of Parliament we should be given ample powers of investigation in order to obtain all the information that was wanted. The hon. gentleman who sits beside him, the then Minister of Immigration and Colonization, the present President of the Privy Council (Mr. Calder), was also promptly on his feet to explain that the Government were anxious to get the Estimates through and that if we would only wait in our requests for information until the report of the Board of Directors were tabled, we could have all the committees we liked and the fullest investigation into the affairs of the railways. My right hon. friend the Prime Minister himself gave the House a definite assurance, in positive terms, that we could have all the information we desired in regard to matters appertaining to the report of the Board of Directors or to any other question concerning the operation, management or control of the national railways. Now, this year, when we have a deficit of $70,000,000, the Government changes its policy entirely, turns in a directly opposite direction, and informs us that we shall have no information whatever. They say: "We will give no information to the public by means of answers to question, or through the production of papers. We will not allow a special committee of Parliament to get that {Mr. Mackenzie King.]
information; all we will do is to concede a committee of Parliament for the purpose of studying certain academic questions"-questions which my right hon. friend has elaborated at great length-" but we will not give the committee power to get facts with respect to the cost of materials, with respect to contracts, with respect to methods of management; in other words, we will give no information that will help to explain this enormous deficit." Now, that is a position which, in the sight of the people of this country, is absolutely indefensible.
Let me make clear the distinction between the Government's present attitude and their professed attitude of last year. I do not say that it was their true attitude, because, as circumstances proved, once the Government got under way with the Estimates, they quickly forgot their promises that Parliament would be amply supplied with whatever information was required. In Hansard, on April 26, 1920, as reported at page 1671, will be found the following questions I addressed to my right hon. friend.
Mr. Mackenzie King:	The Minister of
the Interior said-and his remark was very significant

that while the Government would bring down a report somewhat in the nature of the report made by the Canadian Pacific Railway Company, Parliament or any committee of Parliament would have a right to investigate everything disclosed by that report. I think I have reported my hon. friend correctly i-n that regard.
Mr. Meighen: That is right.
Mr. Mackenzie King: But what about the things that are not disclosed in that report? That is just exactly what we want to get at through the questions we are asking.
Mr. Meighen: If they have to do with the company, the hon. gentleman will have a right to information as to those also.
There is a statement which my right hon. friend made last year to this parliament. In regard to anything that had to do with the company, we on this side of the House, or members of Parliament generally, were to have right to the fullest possible information; but the doctrine laid down by my right hon. friend this year is that touching anything that appertains to the company we shall get no information. Only on such matters as relate to the department, and the relations between the department and contractors, for example, is this House to receive any information. Now, Mr. Speaker, we cannot bear too clearly in mind this complete change of front on the part of the Administration. This year they have brought forward a distinction, between the company's respon-


sibility in managing the railways and the Government's responsibility. They say that so far as the Government is concerned they have no responsibility other than as regards matters of a purely departmental concern; that anything pertaining to the management of the road through the company is something that concerns the company, and that Parliament is not to be informed upon it.
But the Prime Minister was not the only member of the Government who gave the assurance that if we passed the Estimates we would be supplied with any information as to the affairs of the company. His colleagues, in the House, as I have already mentioned, were all of one mind on that point. On April 26, 1920, the Minister of Immigration (Mr. Calder) as reported on page 1671 of Hansard, said:
Every opportunity and every facility should be provided to this House to examine into every transaction. Everything that the management do may be brought under review.
Now we are told that nothing the management does is to be brought under review -the direct opposite. Again on page 1672 of Hansard my hon. friend is reported as follows:
This House will have the fullest opportunity to inquire into every dollar's worth of expenditure that has been made by the National railways during the past year.
Let me read the statement again, Mr. Speaker, and contrast it with the position which hon. gentlemen opposite are taking this year. Mark this: the statement was made at a time when the deficit was forty millions. We have now a deficit of seventy millions, and it is threatening to become a deficit of one hundred millions for next year. When the deficit was forty millions my hon. friend said:
This House will have the fullest opportunity to inquire into every dollar's worth of expenditure that has been made by the National railways during the past year.
More than that, the Minister of Immigration and Colonization went on to say:
It simply means that there will be a time when the fullest opportunity will be presented to Parliament to inquire into every detail of the work of the Canadian National Railway system.	.
There we have three distinct statements and pledges: first, that everything relating to the management shall be disclosed; second, that every dollar's worth of expenditure shall be accounted for; third, that every detail of the work may be inquired into. And now we are told by hon. gentlemen opposite that neither as respects the management nor the expenditure nor details of the work are the members of this Parliament to have any information whatever.
But the hon. ministers I have just quoted were not the only members of the Government who spoke in this way. I see opposite me the hon the Minister of Finance (Sir Henry Drayton) and he, I think, will recall that he made a statement to the House at that time, as Minister of Finance, with respect to the attitude of the Government in giving information. That statement was made on April 26, 1920, and will be found at page 1680 of Hansard. It is as follows:
The House will be given the fullest opportunity to examine the report when it is brought down. Select committees or any thing else you like. These committees will be a great deal more than the shareholders of the Canadian Pacific will get, but make thorough inquiry then if you will, so long as the detailed business from day to day is not of necessity more or less interrupted.
In other words, what the Minister of Finance assured us was that so long as we did not question the ministry from day to day with respect to matters which might affect the business management of the system, that if we would be content to wait until the report was brought down, we could ask for committees and those committees would get all the information that they might want on any question that they liked to ask. Now we are told that we cannot have a committee except for the purpose of an academic inquiry.
But, Mr. Speaker, the Minister of Railways also gave a pledge on behalf of the Government.


Mr. PARENT:: You can rely on that
one.


William Lyon Mackenzie King: Here is the
pledge given by the Minister of Railways on June 25, 1920. It is to be found on page 4194 of Hansard and is as follows:
I would think that in the future there would be no reason why a special committee of the House should not be appointed i.n connection; with railways and let some of the officials come and explain the operations and give any information the committee may want.
Now, Mr. Speaker, what are we to conclude concerning the attitude of the Government at the present time when we have had the Prime Minister, the Minister of Finance, the Minister of Railways and other of their colleagues assuring Parlia-

ment before the Estimates are passed, that committees will be granted, that the fullest information will be conceded, that the House will get all the information it wants, and, then after the Government have succeeded in getting their Estimates through, they come hack to Parliament the next year and tell us that we will get information in regard to any of these matters one way or the other?


Some hon. MEMBERS:: Shame.


William Lyon Mackenzie King: Let me say,
Mr. Speaker, that the people of Canada have a right to an accounting for every single dollar of public money that is being spent on the national system of railways, and no fiction, no subterfuge, on the part of my right hon. friend or his Government will serve as an excuse for that fundamental principle of responsible government not being adhered to if it is at all possible. What does my right hon. friend, or the Minister of Railways, say when we now ask them for information in regard to these roads? They say the Government has no responsibility; that responsibility belongs to the management. When we ask of the management theysay "We have noi responsibility, we are under the Board of Directors." At other times my hon. friends opposite also say to us "The Board of Directors are responsible." I think my right hon. friend said the other day that in this respect the Act would speak for itself. He disclaimed that any department of the Government was responsible and insinuated, though he did not say it, that by this Act, Parliament had made the Board of Directors responsible. Well, Mr. Speaker, let me read what the Act says in regard to the responsibility of the Board of Directors. It will be found in section 6 of the Statute 9-10 Geo. V., Chapter 13:
6. No Director of the Company shall be under any personal responsibility to any shareholder, director, officer or employee of the Company, nor to any other person, nor, except with the approval of the Governor in Council, shall be subject to any pecuniary penalty under the provisions of any statute, in Tespect of his office, or any act done or omitted to be done by him in the execution thereof.
In other words the Government virtually say "We will accept no responsibility," the Board of Management have no responsibility and the directors according to the Statute have no responsibility: in this way there are hundreds of millions of dollars of public money being spent with-
JTMr. Mackenzie King.l
out any responsibility one way or the other. My right hon. friend asks me: what is the explanation of the condition into which these roads have got; what is the explanation of this large deficit? It does not require any genius to make an answer or to give the explanation. Tell any man with hundreds and thousands of dollars to spend that he has no responsibility, that there is no responsibility in any direction, and you will very soon find money being squandered in all sorts of foolish directions -there is the explanation. We have departed from the fundamental principle of responsible government in the matter of holding the executive responsible for all expenditures of public moneys, and the minute you depart from that fundamental principle of government you bring the whole edifice to the ground. So, Mr. Speaker, the position we on this side take is that nothing will be satisfactory to the people of Canada except a return to the recognition of the obligation of the Government to account to the public for every cent of public expenditure. We will hold the Government responsible for the expenditure on these railways, and we will expect the ministry to find some way of giving Parliament the information which it has a right to have. Now I shall wait until we see what are "the concrete terms" -to use the words of my right hon. friend -in complete form which he suggests as to the means he proposes to give Parliament for securing information before stating what further action we will take. But I would tell my right hon. friend now that if he brings in a motion at all in accord with the statement which he made this evening, if he brings along the suggestion of a committee with only the right to study and report, it will not be acceptable to the people of this country and will be strongly opposed by those of us on this side of the House. We will not oppose it for the sake of offering any opposition to a committee. What we will demand is a committee with powers sufficiently wide to get information which the people have a right to be supplied with in view of the very serious condition that this problem has brought the country face to face with at the present time.


Charles Joseph Doherty: 
Mr. CAHILL:: What about the large
details?


Charles Joseph Doherty: With regard to the
large details, the committee that it is proposed to create is asked to report to us as to what the information is that this House can be given, and, consequently, should be given consistently with the two public interests that I have pointed out, to report to us what is the best method of obtaining that information and of giving it to the House in view of the purpose of conciliating these two public interests; then to report to us upon the system of auditing that should be adopted and the extent of detail that should be given in the annual report, this for the purpose of enabling the House to decide what information should be obtained in the public interest and what is the best method of obtaining it; and, finally, whether and for what purposes the committee should be continued. Now, it is not proposed that this committee shall be the method of obtaining information for the general purposes of this House. If it were so, how illogical it would be on the part of this House-and that is what I understand the leader of the Opposition suggests ought to be done-having first decided that there should be some discrimination with regard to the information which the House should ask for and obtain, to proceed to appoint a committee that would exercise no discrimination whatever, but ask for anything and everything that any member of that committee might want. The hon. gentleman entirely misapprehends the proposal that has been put forward here. What the House is asked to do is to ascertain what is the best instrument whereby the information

that we ought to get can be obtained, and, through its committee, to state, having regard to the consideraions I have mentioned, what information ought to be made public. Then, there is the question of the best method of obtaining that information, and, finally, the best method of auditing the accounts of these different companies, so that the reports of the auditors may be accepted as statements of the proper condition of the companies in which we are interested. Last of all, there is the question of the permanency of the committee.
Now, save when he thinks it is necessary for oratorical purposes to work himself up into apparently uncontrollable indignation, the leader of the Opposition, I believe, earnestly desires to find a method by which he may consistently with the public interest get that information for which he so hungers and thirsts. All that this House is asked to do is to provide a committee to report to this House as to what is the best method of attaining that desirable end. Is that not a reasonable proposal? Surely the debate of the other day made it quite clear that two conflicting principles required to be conciliated if the public interest was to be served. And what is the present proposal? That we sit down and study with the aid of a committee what is the best way to conciliate those two principles so as effectively to serve the public interest. I am sure that any one who reflects for a moment will see how entirely uncalled for was the wrathful indignation of the hon. leader of the Opposition and will recognize in this suggestion a sincere desire to arrive at a practical method of finding a solution of the difficulties:; that present themselves and of achieving the necessary result of providing the House with the information to which it is entitled and of so nroviding it as not to bring about any deteriment to the public interest.


Daniel Duncan McKenzie: Mr. Speaker, unless we are entirely mistaken in the purposes of Parliament and in the constitutional rights of the people of this country, the representatives of the people have some purpose in coming here. Otherwise we on this side, acting under some illusion and under "indignation" as the Minister of Justice (Mr. Doherty) says, completely misapprehend the purpose of our coming here. Are we not to know'anything at all? Are we not to ask any questions for conscience' sake? Are we to submit tamely to everything that the Minister of Justice passes out to us?
I do not think, Mr. Speaker, that that is the TMr. Doherty.]
purpose of the people of this country in sending us here, notwithstanding the lessons and reprimands which come to us from the Department of Justice. We on this side, while never over-satisfied with the analytical disquisitions of the right hon. Prime Minister (Mr. Meighen) always manage to understand pretty well what he means. He told us very clearly to-night what was intended by this commiteee. But the Minister of Justice was not satisfied with the English language as presented by the Prime Minister. He thought it was a jumble of words without meaning; that indignation was possibly provoked by their presentation, and, as a Daniel come to judgment, the Minister of Justice, in his lucid, clear-cut, well-determined sentences, told us exactly what the Prime Minister meant. The hon. leader of the Opposition (Mr. Mackenzie King) took high ground when he said that there really was nothing to the purpose in the speech of the right hon. Prime Minister. If there was any doubt as to the soundness of the position taken by the leader of the Opposition we have the most conclusive proof of its correctness in the commentary of the Minister of Justice.
Let me remind the Minister of Justice of what he said a very few seconds after he got through with his speech. He said: "The leader of the Opposition works himself into a fury of indignation, of wrath, over imaginary difficulties." That is his language. As a humble representative of the people of this country, I ask the Prime Minister and the Minister of Justice if a deficit of $49,000,000 last year in the operation of a public utility with which the people have to do, where the people have to furnish the money to pay every cent of that expenditure, where the freight rates of the country were raised 40 per cent over and above what they used to be, where enormous amounts of money have been dragged and extorted out of the pockets of the people of Canada for keeping this incubus going-I ask them if that was an imaginary thing. Yet, after this was all done and additional millions of dollars were filched out of the pockets of the people, the Government come back and tell us: "Last year we had a simple deficit of $49,000,000 which, in the estimation of so worthy a gentleman as the right hon. Minister of Justice, is a mere illusionary matter that no person should be concerned about; it is imaginary and not worth asking any questions about at all." I see a number of able business men sitting around and behind the Government. I should like

to ask them if, when they go hack to their constituencies in all parts of the country, they are asked: "What is the condition of the railways; I am told that last year you had a deficit of $49,000,000; that this year you have a deficit of $70,000,000, and that next year you will have a deficit of $100,-000,000"-if they will undertake to wave their constituents aside and say: "Oh, gentlemen, do not be illusionized by these things; they are merely imaginary. All you have to do is to imagine that there is no such a thing as a Government railway at all. All you have to do is to imagine that the Government railways made $65,000,000 of profit last year, and you have the money in your pocket." So the Minister of Justice says. I told the right hon. gentleman once before that we in the province from which I come are in the habit of having the greatest respect for the office and the person of the Minister of Justice, and I would feel myself rather confused if a man stood up and produced this Hansard at a public meeting, say in the town of Sydney Mines and said: "Why, you are talking about deficits; the right hon. Minister of Justice said last year that that was merely imaginary; that there was no such a thing at all." Will the right hon. gentleman say that that is really the fact?
I submit this to the usually fair mind of the Minister of Justice. It has been proven to the hilt that last year, before the Estimates were through, before we gave the money to Parliament and to the Government to spend, we were promised by one minister after another, by the Minister of Railways (Mr. Reid) by the then Minister of the Interior, by the then Prime Minister himself and, I am sure, by the Minister of Marine and Fisheries (Mr. Bal-lantyne), who is usually prolific in promises and very barren in performances, that every dollar that was expended of the money of the public would be accounted for. I am sure the Minister of Marine and Fisheries told us that every dollar of the public money spent in his department would be accounted for twice over. Those were the promises. Did hon. gentlemen expect members of the House and, in particular, members of the Opposition to believe them? I am sure they will not dare to say in this House: "We made those statements, but we did not expect you to believe them. We were not sincere." I am sure they will not dare to take that attitude. We believed them; we voted the money, and here we are this year with all this money expended and $70,000,000 more expended that we did
not vote at all. The Government come back to us now in face of those promises, and the Minister of Justice, leading the van, says: "You will not get one word, not one iota, not one figure; you can just go and do your best about the matter; we will sit tight here, and you will not know one thing that is going on behind our closed doors; we are in the dark lantern brigade which you said we were in, and we will not flinch one inch from the position we take." Does the right hon. gentleman not think that is a subject for indignation, if there was indignation? Does he not think that is a reason why the people of this country should rise in their might and say: "What is the good of Parliamentary representation? What is the good of having the name of responsible government if these facts are not given to the people." I can only repeat what the hon. gentleman who leads the Opposition says, and I think it is plain and simple. We still adhere to the doctrine of responsible Government, to the position that the minister of every department of Government must come down to this House and explain its expenditure. I do not think, when the business of this country is carried on under twenty departmental heads, we can say that they are overburdened and overloaded with work when we ask them to be able to come down to this Parliament and explain in reasonable detail what has become of the money of the country. If the Department of Railways has become top-heavy, if it is too big, if it cannot be handled by one man, why not divide the work up so that departments which have not so much to do will have some part of that work and give us details which are necessary in order to satisfy the people of Canada that their moneys are properly expended? I remember when we sat behind the Right Hon. Sir Wilfrid Laurier as Premier of this country and hon. gentlemen who are to-day on your right, Sir, were on this side of the House, we had to account for every dollar, and if a few thousand dollars were expended by way of ever-expenditure or anything of that kind, the greatest possible storm was raised until every dollar was accounted for. That was the proper thing. When a change of Government took place, when those hon. gentlemen went to your right, and when they have the purse-strings and the expenditure of the money of this country, is there any doctrine that can be thought of for one moment but that for every farthing of the money which they

expend, they shall account to the honest people of this country who are furnishing the cash and who have, for the time being, given the Government their confidence in the expenditure of that money? There is only one doctrine, one position, one stand that any sane community or representative can take in this House or in the country.
As regards the idea of appointing this committee, have we not enough committees already? I have not said anything so far about this committee; I do not care very much whether it is appointed or not. We have already a string of standing committees, and why should this public business not be sent to one of them? Every dollar that we are going to have inquired into before this committee is money belonging to public account, is it not? We have a Public Accounts Committee. If there is anything to be inquired into by way of the public accounts of this country, why does it not go to the Public Accounts Committee? Is that not what a Public Accounts Committee is for?- Is there any money expended in connection with the ships, the railways, the Post Office, Public Works or any other department that is handled by the Government that is not public money? Therefore, if the Government desires a full inquiry into this question, should it not be sent to the Public Accounts Committee? It is not the function of any committee to do the business of the Government. If there is any inquiry which members of Parliament may require; if they are dissatisfied with any account that the Government has brought down, they may ask for a committee. But in the first instance it is the duty of the Government to be prepared to give every information that may be required, and if details are asked for by people who may be dissatisfied, then the question may go to a committee for a further investigation. But the floor of Parliament, and not a committee, is the place for hon. members to find out the facts. The idea of saying that there are no politics in the management of the road; that it is entirely free from politics, and then after all is said and done and you come to an inquiry and an investigation, the matter is to be sent to a partisan, political committee, because in this House you cannot get a committee other than a partison committee that will act in a partisan manner. I have been on quite a number of committees, and when a matter came to the test, I never saw anything but a clear-cut division on the partisan bias of each member of the com-
mittee, and that is what would happen in this case.
I submit therefore that instead the right hon. Minister of Justice should have devoted himself to answering the charges that were made by the leader of the Opposition, that promises were made last year to give this information, and that the information is not only not forthcoming now, but has been absolutely denied. The Minister of Justice tells us that the business of this committee is to perform the impossible. He tells us that its business is to provide intelligence for the Department of Railways, intelligence and wisdom for the Department of Marine and Fisheries, and efficiency for the management of our railways. If he can find a committee under God's blue canopy that will give intelligence to the Department of Railways, wisdom to the Department of Marine and Fisheries, and efficiency and executive ability to the railway management, I should certainly like to see the personnel of that committee.


Henry Lumley Drayton: Mr. Speaker, the fact that apparently I am particularly to blame in connection with the promise said to have been made last year-and I have no doubt it was made-impels me to throw myself very unexpectedly into this debate. But once in it, I think that we should all try: to understand at the earliest possible moment that we are debating a very serious situation, a very serious question of policy and of principle.
It is easy to say "losses"; it is easy to say that public ownership is wrong; it is easy to throw the cheap gibe and the cheaper sneer. We are told that last year we only asked for so many millions, and that under public ownership this
11 p.m. year we are asking an enormously increased vote. I would like to point out one thing to hon. gentlemen, for we might just as well get down to the basis, and see whether their basis is right; they may be right by accident.
I would point out that the tremendously increased vote this year is not the result of public ownership; it is not the result of anything that has been done by the committee now managing the national railways. The tremendous vote this year is the result very largely of private operation, private ownership and private management of the Grand Trunk Railway. We are asking a vote this year of $87,000,000 for the Grand Trunk itself, run and operated as a private company. Now, there is a

great deal of room for debate as to whether or not the people as a people can properly run, own and operate a railway, but there is no room for debate on one phase of that question, for it has been settled by every country that has tried it, and that is you cannot run a difficult, complex business organization such as a railway, covering an enormous mileage and touching the home life of the people in every city and town the whole country over, by direct parliamentary control. I do not think there is any room for debate on that question, and if there be no room for debate on that question, it seems to me we are perhaps not arguing the real point at issue, that point being whether or not public utilities can be operated through commission form or by trustees for the public in the interests of the public. That is really what we are arguing to-day. We are not arguing anything else. I put it to any hon. gentleman who has studied public ownership of public utilities by direct parliamentary control; has he ever found it result in anything except absolute failure?


Alexander Kenneth Maclean: Has any hon. member ever suggested direct parliamentary control?


Henry Lumley Drayton: I cannot very well distinguish between degrees of parliamentary control. I cannot very well distinguish between a system that would allow the Order Paper to be cluttered up every day with questions as to why a station-master was removed from some small station down there, or why a switch was not put in here or there-I cannot very well get away from that system without at the same time getting away from parliamentary control.


Frank S. Cahill: Will ]my hon. friend
tell me whether under our system he could have any control if he had not parliamentary control. He either must have parliamentary control or no control at all. The people are responsible. My hon. friend cannot get away from that.


Henry Lumley Drayton: That is a
perfectly proper question, and I shall be very pleased to deal with it. As I was saying the issue here is really whether or not public ownership as we understand it, public operation as we hope to get it, is to be given a fair trial. I want to touch just for a moment on the point raised by my hon. friend from Pontiac (Mr. Cahill). I think there is a great deal of difference between bringing up all the little details
of management, the small questions which inevitably always are, and always must be, questions for immediate and prompt decision by the management, and the larger and more important questions which arise out of the results of the management's operation and out of their annual report. Now last year-I am going to try and be consistent, and I think I am-


Daniel Duncan McKenzie: You will find it very
hard.


Henry Lumley Drayton: Not as yet.
I would find it very hard to reach the heights of fancy and joke that my hon. friend can, but so far I have not found it very hard to be consistent. Last year I said that I saw no reason why the report of the directors should not be dealt with by a committee. I conceive that to be a very different thing from worrying the management day in and day out for information as to the petty details of management. I am quite sure hon. gentlemen know very well how railways are run, and that I shall only be drawing to their attention something they know all about when I say that the function of a railway president is really the function of giving prompt and just business decisions. He is a referee of tremendous responsibility. He must dispose of an infinitude of questions in a very short time if he is to deal effectively with them, and for the iife of him he could not tell you, a month after a decision was given, why he had done this or that in connection with some small matter of detail. The leader of the Opposition stated that there was no responsibility on the part of the directors. Well, I am sure my hon. friend wants to be fair, and he will find that the provision that is there made in the statute is one which is incorporated in many and many an Act for a public purpose, where duties are cast upon individuals who do not directly share in the profits of an enterprise. All that is stated there is that the directors shall not be personally responsible in damages for acts done in their capacity as directors, and you have that provision also in connection with the managers of many companies. It does not mean that they are not responsible for their management; they are responsible therefor just as much as any hon. gentleman is responsible to his constituents for what he does in Parliament. Now, if there be any better way, we ought to try-to find it; and, after all, that is what we are trying to do.


Mr. SINCLAIR (Guysborough):: To
whom are these directors responsible?


Henry Lumley Drayton: They are directly responsible for the discharge of a high public trust.


William Stevens Fielding: Responsible to whom?


Henry Lumley Drayton: To the people of the country.


William Stevens Fielding: Through what channel?


Henry Lumley Drayton: Through this House.


Some hon. MEMBERS:: Hear, hear.


Henry Lumley Drayton: And they have made their reports accordingly.


Georges Parent: There are no details.


Henry Lumley Drayton: The hon. member will find that there are complete details of everything that really goes to solve the question as to whether or not these men are efficient, and whether they are running this public enterprise properly. The yardsticks are all given. As a matter of statutory duty, these reports are filed every year. The full particulars of the different activities are all given,-passenger activities, freight, mails, express, and miscellaneous operations, together with operating expenses. They are all given, and if there be anything more that should be done, I would have thought that it would be done just as I suggested last year.


Daniel Duncan McKenzie: To whom is their report addressed?


Henry Lumley Drayton: The report
goes to the Minister of Railways and is by him tabled annually.


Daniel Duncan McKenzie: Then he is responsible?


Henry Lumley Drayton: He simply
tables the report.


Samuel William Jacobs: Can these directors be brought before the Public Accounts Committee for examination?


Henry Lumley Drayton: I do not know that there is any reason why they should not be. Of course, I know many reasons why in some respects this is not desirable.


An hon. MEMBER:: What are they?


Henry Lumley Drayton: If many small matters of detail are to be inquired into; if they are to be asked to give up the full information regarding their traffic arrangements, for example; if they are to be asked to disclose' full information as to-


Frank S. Cahill: As to deficits.


Henry Lumley Drayton: I did not catch that.


Frank S. Cahill: I said, information as to deficits.


Henry Lumley Drayton: Oh, we will come to that later on. I was saying, if they are to be asked to disclose full information as to their business relations as directors in connection with their different industrial sidings; in other words, if they are to be asked to give up all that business information which every man in business for himself regards as his private property, and if they are to turn all this over to the advantage of a competitor, then there are many reasons why they should not appear before the committee for this purpose. On the other hand, if they are brought before a committee such as we now suggest, or any other committee, for the purpose of enquiring into their operations with a view to ascertaining whether economies could not be effected, and moneys saved in various ways, no reason in the world could be advanced against this. As to the deficit, that is certainly a matter that should be looked into. It is certainly a large operating result; it is certainly a matter about which very few persons can find anything for laughter; at least I cannot; it is certainly something which ought to be reduced, if possible.


Samuel William Jacobs: Would not that be accomplished by going into the small details? Little drops of water make the mighty ocean.


Henry Lumley Drayton: If the hon.
member started counting the drops of water in the ocean, he would not be engaged very much longer in the process than he would be in trying to find out exactly what was wrong with the railways by going into little bits of detail here and little bits there. By the time he got them all collected he would have such a mass of material that it would be absolutely impossible for him or any one else to digest it. That is undoubtedly something which any railway president, or any other man who understood the operations of railways, would regard as ridiculous. Do you think that a railway president looks after matters of detail? Do you think that any man charged with large affairs, carrying on an enormous business running into millions, bothers about details himself? He has many persons under him to look after these matters.


Georges Parent: Suppose the appointment of an agent at some station might mean a clear profit of $15,000 a year to the railways, does not the minister think that1 an agent should be placed there?


Henry Lumley Drayton: I think that any one who was entrusted with the large responsibility of running the country's railways would he in a far better position to judge as to whether or not an agent should he put on at any particular station. That is something that is left in the hands of the management.


Georges Parent: I was suggesting a case where a clear profit of $15,000 would accrue.


Henry Lumley Drayton: If there is any case such as is suggested by the member, it is not necessary to make trouble either in the House or with the management. All he has to do is to go before the Board of Railway Commissioners.


Georges Parent: It is not under their control.


Henry Lumley Drayton: They are
bound to appoint an agent where there are earnings of $15,000, not net but gross. The hon. gentleman is wrong; the lines are under the board. The board fix their rates, and while the statute does not give them, as a board, the right to interfere in detail matters of operation, through letters of the ministers of railways the board have exercised that jurisdiction. Certainly the railway management will not refuse to appoint an agent where such an appointment is necessary.	>


Georges Parent: If the hon. gentleman will allow me I can tell him that the chairman of the Board of Railway Commissioners says the contrary?


Henry Lumley Drayton: Well, I can only speak from recollection which is quite recent, as to the very general practice. I exercised the right and I exercised it at the request of the Government. But after all the Act is there and it will not be very long, I hope, before the anomaly is removed if the matter be in the position to which the hon. gentleman refers.


James Alexander Robb: Would the minister consider the purchase of supplies and equipment a fair subject for inquiry by the committee?


Henry Lumley Drayton: You would
have that in the report and everything that is in the report, I think, is a perfectly fair matter for inquiry.


William Stevens Fielding: Would we be free to ask for copies of tenders?


Henry Lumley Drayton: I do not think that is something that ought to be done. Let me tell the hon. gentleman something that we know about. Let me tell him that after would-be contractors, who were trying to get a specific price for commodities, had failed to secure a contract-that contract having been let to a lower tenderer-questions were asked in the House as to the details of those tenders. It is a dangerous thing to try and run a competitive business in such a way, where the men you want to do business with know exactly what they have got to bid and how near they come to the prices offered by their competitors. It is certainly not the way that any railway company in the world that has ever made a success of its business has been operated. After all, what are we trying to do? What we are trying to do is to see if we cannot better the present condition, see if we cannot compose the differences that exist. I think those differences are largely differences which can be easily composed, because I am quite confident that so soon as we realize what the effect on the country as a whole would be if there is indiscriminate searching from time to time and day to day into the business of this large concern, we are all going to be together. We are trying to see what is the best thing to be done. When I said last year-and there again the difference can be so easily illustrated-that there was no objection at all to the fullest reference of the report, or anything else that was asked, to a committee, is there not the greatest difference in the world between that and the asking of questions-for example, such a question as was put the other day in the House as to why an agent was not at work for a given number of hours in a particular city?


Mr. LAPOINTE:: My hon. friend has spoken of "the Board of Directors" of the Canadian National Railway. Has any board of directors been appointed under the law which was passed a few years ago? Has that corporation been organized to any extent at all, or are the railways managed, as they were then, under the Government by commissioners appointed by it?


An hon. MEMBER:: By order in council.


Henry Lumley Drayton: The hon. gentleman is quite correct to a certain extent; but I am afraid that in the main he is quite wrong. It is quite true to say that

the general Act has not yet been put into effect, but it is also entirely untrue to say that the railway system is governed by a commission. The Board of Directors are elected just in exactly the same way as the board of directors of any company would be elected.


Andrew Ross McMaster: Except there is only one shareholder.


Georges Parent: Not by the shareholders.


Henry Lumley Drayton: Perhaps hon. gentlemen will allow me for one moment; I am now speaking in answer to a question. They are elected in exactly the same way as the directors of any other company; there is one difference and only one. That one difference is that instead of a certain portion of the public being interested in the election of the directors, the whole of the public are interested in it, and that instead of the shareholders-through their proxies as is usually done-electing -the directors, the whole of the people elect the directors through the Government.


Some hon. MEMBERS:: Oh, oh.


William Stevens Fielding: The Minister of Finance asked a question a few moments ago, a very proper question, "What are we trying to do?" I will not undertake to describe what I think my hon. friends opposite are trying to do; I did that the other day and they thought I was not as courteous as I ought to be. But I will undertake to tell my hon. friends, and the Government, what we on this side are trying to do. We are simply trying to assert and to maintain the right of the people of Canada to receive an accounting-in gross or in detail as they please-through their representatives of every dollar of the public money that is spent. That is what we are trying to do- only that and nothing more. But that is something which is so plain and so simple that I am satisfied the people of Canada will readily understand it. But hon. gentlemen opposite are trying to make excuses for not doing that, and they are raising men of straw in order that they may knock them down. They are raising ghosts as to all the difficulties in the way. "Why," says the Minister of Finance, "if all these little details were brought down here what a trouble it would be." Well, I will not repeat the argument I used the other day. Our contention is that this matter should be dealt with precisely in the same way as it would be in the case of one of our own departments; there is no reason why the same principle should not apply. If the Prime

Minister is going to move for a committee, and the proceeding will give to the House all the rights and privileges which it has as respects every other department of Government, that will be all right; but if he is going to say "We will give the House information regarding the Department of Public Works, but we will refuse it as regards the Canadian National Railways," I say that is wrong. We are going to stand on that and make that the issue in this House and if necessary before the country. The hon. gentleman, I say, raises a ghost for the purpose of trying to show that there are difficulties in the way. He says, "What good are these details anyway?" But take the position of the Department of Public Works or the Department of Railways, any or all of the departments of Government, and the way we act with respect to them. We have the right to demand the details as to every dollar of expenditure of the Public Works Department, but we do not do it. Why should we not have the same privilege as regards the national system of railways? We would have the right under our contention to deal with all these matters of detail, but we would not do it. Why? Because they are not necessary. To-day a question is asked regarding the Department of Public Works; in the matter of a contract for example, suppose a question is asked now about the price that is paid for coal? Well, the Minister of Public Works may reply, "I may say to the hon. gentleman that that matter is still under consideration. We have received tenders but we have not awarded contracts and we are not able to give the information"-a perfectly proper answer and the House would accept it. But if the same question is raised regarding the Canadian National Railways we are told, "That is a violation of all business rules," and we are not to know the price that the Government railway management paid for coal although we would be told what the Public Works Department paid for such a commodity. There is no earthly difference between the two. I suppose the Department of Public Works every year pays-I do not know the exact number but at a rough guess I would say ten thousand accounts. How many of them do we bring before Parliament? We do not bring them before Parliament once in a blue moon, unless something arises which calls for an investigation. We have the right to investigate every item, and we should have the right, but we do not exercise it. Why should we not have the same right in the case of the Government railways?

It is one thing to have the right to go into all these details, and in giving that right without any restriction or limitation you are carrying out the proper principles of parliamentary government; but when you deny and restrict that right; then you are departing from all the soundest principles of parliamentary government. I utterly fail to see any reason why we cannot apply to the railways of Canada the same principle that we apply to the public works or the marine and fisheries. I have not found any indication yet of any kind of information the bringing down of which could do harm to our railways. Not one of the hon. gentlemen who have spoken has given us an illustration of something we might ask for, but which the railway company might properly refuse to give. In a motion that we laid on the Table the other day we recognized the fact that at all times there are certain matters in connection with government which in the wisdom of the Government they may see fit to withhold. We recognized that fully, and we recognize it as fully in the matter of our railways as in the matter of the Marine and Fisheries or the Public Works departments. The Government have to be the judges of that, and the House will always recognize reasonable grounds refusing information of that character. What we on this side contend for is that the principle which applies to every other department of government should apply to the Canadian National railways. Not a shadow of ground has yet been shown to indicate that any harm would be done by bringing down any item of the information we have asked for. I take the illustration in regard to coal. I can understand that if we asked for information about tenders for coal the Minister of Railways would say: "This matter is under consideration, it is not settled, and the information cannot be brought down." But after the contract has been awarded, what earthly interest can suffer by the answering of a question as to what companies we got the coal from and what prices we paid for it? It is all nonsense to say that you are going to give information to your competitor, the Canadian Pacific railway. Your competitor certainly knows all there is to know in connection with railway matters. Do not be alarmed about the Canadian Pacific railway. The are pretty shrewd, wise fellows, and they know all that is of any value to know.
But the simple question I am answering is the question of the Minister of Finance. What we are trying to do, and what we are going to do with all our energy, whether we succeed or not, is to stand for the rights of the people of Canada to have either in gross or in detail whatever information may seem to be reasonably necessary in the judgment of any member of this House as respects the expenditure of every dollar of public money that the people of Canada are obliged to pay.


Edward Walter Nesbitt: Mr. Speaker, I understand that the discussion has arisen through the resolution of my hon. friend from Halifax (Mr. Maclean) which asks that a special" committee be apointed to inquire into the operation of the national railways; in other words, to dig into the operation of those railways with a view to recommending any improvement that they can suggest with reference to that operation. As to the whole of the details being given to the House, I was one of those that sat at that time on the opposite side of the Government when the Canadian Northern railway was taken over, and I absolutely insisted that the railways should be put under the management of an independent commission in so far as it was pqssible to put them under such a commission, I believe that that has been done. I believe that the present Minister of Railways (Mr. Reid) has carried out that policy to the fullest extent and that he has interfered as little as possible with the management.
Answering my right hon. friend who has just sat down, the hon. member for Shelburne and Queen's (Mr. Fielding), for whom I have the greatest respect, I remember last year when the discussion took place over the Minister of Railway's statement that the minister did not hesitate to give to the House any information in his power. I remember distinctly with reference to the question of coal that he gave the purchase price in the various sections of the country through which the railway operated. Nor do I think has this Government refused any reasonable request on the part of any member of the Opposition or on the part of any other hon. member with reference to the operation of our national railways. But you must bear in mind, Mr. Speaker, that we insisted that those railways should be operated as far as possible by an independent commission. That is being done. You cannot bring those men on to the floor of the House to

illustrate every little detail with reference to the operation of the system, and it is not customary for any corporation to give such details to its shareholders. I have had a good deal of experience on boards of directors, and I have never yet known the shareholders to ask for absolute details of operation.


Georges Parent: Why not?


Edward Walter Nesbitt: Why not? Those details are open to them if they want to go and .examine the books.


Joseph Archambault: That is what
we want to know.


Edward Walter Nesbitt: I have no doubt that
-details of the management of the national railways are open to any member of the House.


An hon. MEMBER:: No.


Edward Walter Nesbitt: Have you tried and
have you been refused?


An hon. MEMBER:: Yes.


Frank S. Cahill: The minister refuses
everything.


Edward Walter Nesbitt: I do not believe anybody has been refused. Let me repeat, I do not know any corporation that tells its shareholders the details of its operations.


Georges Parent: We know.


Edward Walter Nesbitt: I doubt if you do.


Georges Parent: I do.


Edward Walter Nesbitt: As to this proposed committee of the House consisting of members on both sides as I understand it, the hon. member from North Cape Breton and Victoria (Mr. McKenzie) tonight said that on special committees partisan discussion was just as likely to arise as on the floor of the House. I have sat on special committees .appointed to discuss all kinds of questions since I have been in this House, and I will say for the Opposition, no matter which side of the House I sat on, that I never :saw a question debated by any of those special committees from a party standpoint. Take the question of soldiers' reestablishment, the committee on which sat for two months. I have only this to say for the hon. members who sat with me on that committee, members of the present Opposition, that never by any chance was there a word or action that would suggest that we were discussing the question from [DOT]a party standpoint. And the report was xnot brought in from a party standpoint.

Any spectator who attended the meetings of that committee would not have known which party the members belonged to as far as the discussion was concerned. Therefore I believe that great benefit would be derived by the appointment of a special committee to thoroughly investigate the question of the operation of these national railroads and to report back to the House.
Let me repeat, that I know of no instance where the Minister of Railways in discussing the annual statement of the national railways last year refused to give any information in his power, and I doubt if he will now. I think you are raising a mountain out of a molehill in discussing this question, because I believe that, after all, we all view the matter from the same standpoint, and I am as certain as I am that I am standing here that there will be no difficulty on the part of the Prime Minister in selecting from this side of the House, and on the part of the leader of the Opposition in selecting from that side of the House, men who will forget whether they are Liberals or National Liberal Conservatives, and who as soon as they are appointed on that committee will forget their party prejudices and do the best they can to work out a solution of this very serious question confronting the country at the present time. I hope that that will be the view of the men who are appointed on that committee, and I am quite sure from my past experience that it will be their view, and I hope the Prime Minister will carry out his intention of appointing such a committee.


Andrew Ross McMaster: Mr. Speaker, it seems to me that the Minister of Finance (Sir Henry Drayton) asked a question the reply to which is really an answer to the whole discussion. He said, as I understood him, we could not have public ownership cocurrently with parliamentary control; I think that is a fair repetition of what he said. Now, if that is the case, it will be impossible for us to have public ownership, because we will not give up parliamentary control. I am not an enemy of public ownership; ever since I came to this House, and before, I have been attracted to public ownership. I have been seeking further light on the question and honestly and anxiously inquiring how the matter worked out in practice. I must frankly admit that until now nearly all the evidence that has been brought before me has been against public control and pub-

lie operation of railways. But let me say this: we have to have control of railways, and that control has either to be responsible or irresponsible. I do not think that any member of this House will say for a moment that that control should be irresponsible. Then it must be responsible, and to whom? In the ultimate analysis, to the members of this House. And if you cannot have public ownership which involves ultimate responsibility to this House, then public ownership will have to be given up. .After all, public ownership is merely a matter of expediency. It may be wise or it may be unwise; it may be advantageous or it may be disadvantageous, but the control of the expenditure of public money by this House is a matter of principle, the very basis of our parliamentary institutions and of our British constitutional practice.
The gentlemen who have spoken on the other side have been.at great pains to point out the possible dangers of parliamentary control. They have set up the imaginary bogey that if this House inquires concerning different details of management the Canadian Pacific Railway company will catch on. I think I can say with a fair degree of assurance that nothing of substantial importance happens concerning any railroad in Canada or in the northern part of the United States of which the Canadian Pacific Railway Company are ignorant. It is part of their business to know; I believe they know their business and are well advised as to what goes on with their competitors. After all, the operation of railways is not carried on in the dark, and it must be known what railways pay for their supplies just as the schedules are known upon which the trains are run. So far as rates are concerned they are fixed by a public board, and there is no possibility of one competitor hiding from another the details in that connection. But the point I wish to impress upon the House to-night is that the system of irresponsible control is one which may breed most unwholesome conditions in this country. I accuse no one of wrong-doing in the remarks which I propose to make to-night. But I say that the Government has placed the railways of this country in the hands of a small committee who are called directors but who are the creatures and nAninees of the Government, and that a large number of these men are directors in companies which, if not selling to the railways, have in hand the goods to sell to the railways. I also wish to make this point, Mr. Speaker: these men are directors not only in the Canadian Na-102
tional Railways but also in such a number of other companies as to preclude their giving to the railways of the country that care and attention which the railway situation demands. Now, the other day the member for Essex (Mr. Kennedy) asked the following questions in the House.
1.	What are the names of the gentlemen who compose the Board of Management of the Canadian National Railways?
2.	What is the salary of each and what amount did each receive as expenses during the past year?
3.	Are any of these gentlemen also directors of joint stock companies doing business in Canada?
4.	If so, of what company or companies are they respectively directors?
To which the Minister of Railways (Mr. Reid) made the following replies:
1.	D. B. Hanna, A. J. Mitchell, R. T. Riley, R. Hobson, Major G. A. Bell, Sir Hormisdas l.aporte. Col. Thomas Cantley, A. P. Barnhill, E. R. Wood.
2.	Director's fees, $2,000 each, and travelling expenses to and from their homes.
3.	The Government has no information.
4.	Answered by No. 3.
I would direct attention to the fact that the answer to number 2 was only a partial answer; the question, "what amount did each receive as expenses during the past year" was not answered, it being merely stated that they receive travelling expenses to and from their homes. Now, as a matter of elementary propriety and justice, the Canadian people, who are paying to Mr. Hanna $25,000 a year and to the other directors, who are not expected to give all their time to the consideration of railway matters, $2,000 a year and their travelling expenses, are entitled to know what other companies these directors are interested in, if for no other purpose than to know how far their attention is distracted from the railway problem which is in their special charge. As that information was withheld from the members of this House I examined the Financial Guide of 1920 and I discovered these facts, which I think, should be of interest to the House and perhaps of interest to the country. I find that Mr. D. B. Hanna, who, as I have said, receives $25,000 a year, if I mistake not, as manager of our Canadian National Railways, is also a director in the following companies: Canada Steamship Lines, Limited; Electrical Development Company of Canada, Limited; Canada Mortgage Investment Company; British-American Assurance Company; Western Assurance Company; Canadian North Prairie Lands Company; Brazilian Traction, Light and Power Company, Limited; Rio de Janeiro Light and



Power Company; Sao Paulo Light and Power Company. He is also president of the Canada Flour Mills. Mr. A. J. Mitchell is a director in only one company, the Western Canada Flour Mills. Mr. R. T. Riley is interested as a director in but two companies. He is vice-president of the Union Bank of Canada and vice-president of the Great West Life Assurance Company. Mr. Robert Hobson is a director in the Bank of Hamilton; he is a director in the Canada Locomotive Company, Limited; he is president of the Steel Company of Canada, Limited; he is a director in the Tuckett Tobacco Company, Limited, in the North Star Oil and Refining Company, in the Chartered Trusts and Executor Company, in the British Empire Trust Company, in the Dominion Power and Transmission Company and in the Toronto General Trusts Corporation. Major G. A. Bell is, I understand, a civil servant, and so far as I can learn, he is a director in no company whatsoever. Sir Hormisdas Laporte is a director in the Credit Foncier Franco-Canadien, in the Societe d'Administration Generale, in the Frontenac Breweries Limited and in La Sauvegarde Life Assurance Company.


Joseph Philippe Baby Casgrain: He is president of
Laporte-Martin, Limited.


Mr. POWER:: What do they do?


Andrew Ross McMaster: They sell wholesale groceries in Montreal.


Georges Parent: They do not sell liquor, do they?


Andrew Ross McMaster: I do not know. They probably will not after the first of May. Col. Thomas Cantley is a director in the Eastern Car Company Limited, in Brand-ram-Henderson Paints and Varnishes and in the' Nova Scotia Steel and Coal Company, Limited. Mr. A. P. Barnhill is a director in the Eastern Trusts Company, in James Pender and Company, Limited, in the St. John Iron Works, Limited, and in the Telegraph Publishing Company. He is president of the New Brunswick Electrical Company. He is president of the Acamac Land Company, Limited. He is a director in the Fenton Land 12 m. and Building Company, in the Westfield Land Company, in the Times Publishing Company, and in the New Brunswick Realty Company. Last, but not least, in the number of directorships he holds is Mr. E. R. Wood, who is a director in the British American Assurance

Company, a vice-president of the Canada Life Assurance Company, a director in the Western Assurance Company, a director in the Canadian Bank of Commerce. One would have thought that the connection between that bank and the late lamented Canadian Northern railway wouild have been sufficient to have made the Government believe it was inadvisable to have a director of that bank connected with the railway lines of this country. He is a director in the Barcelona Traction, Light and Power Company, Limited; he is vicepresident of the Brazilian Traction, Light and Power Company, Limited; he is a director in the Rio de Janeiro Light and Power Company, in the Sao Paulo Tramway Light and Power Company, in the Mexico Tramways Company, in the Toronto Railway Company, in the Toronto Power Company, Limited, in the Toronto Electric Light Company, Limited, and in the Electrical Development Company of Canada, Limited. He is a vice-president of the National Trust Company and a director in the Dominion Securities Corporation, Limited.
The first point I want to make is that what we need in this country associated with our railways, if we are going to have this system of nominating a commission and calling them directors, is to see that those men are well paid and that they concentrate their minds upon railway problems. To have these men with all their diverse interests entrusted with this task is a very unwise thing for the country from that point of view. But there is another and, to my mind, a more serious aspect of the situation. As I have read the names of the different companies with which these different gentlemen are associated, I think hon. members will have noticed that there is hardly a requirement of any prime necessity needed by the railways which, if the management wishes, they cannot get from some company in which one of the directors is also a director. I do not know whether this has been done or not; I make no charges against any man without proof of wrong-doing under my hand; but I denounce in unmeasured terms the system such as exists here, because it is quite possible-I aAiuse mo one because I have not the proof-that this forms a little family compact in which the interests of the railway are, perhaps,-I do not know-being sacrificed to the interests of these different companies. It may be perfectly true that Mr. Hanna, when he comes

to consider and to advise the company as to the extension of a line in the Northwest, may remain absolutely uninfluenced by the fact that he is president of the Canadian North Prairie Lands Company. I do not know where those lands are situated; but if we found that a line of the Canadian National railways was being pushed towards those lands, would it not be reasonable for one to be a little suspicious that, in pushing the railway in that way, Mr. Hanna may have, perhaps, unconsciously been affected by the fact that in doing so he would help the Canada North Prairie Lands Company, in which he is a director? As regards locomotives, supposing the National Railways desire locomotives; it may be, for all I know to the contrary, possible that when the Canadian Locomotive company tenders to the National railways for the supply of locomotives, Mr. Hobson knows nothing about the matter at all; that he declines to be present at the meeting of the board where the tenders are opened, and that he does not convey to the Canada Locomotive company any information that he may have as to the price that the Canadian National Railways are willing to pay for the locomotives in question. He himself may be absolutely beyond reproach in this connection; but it is a mistake for the Government of Canada to have, as one of the directors of the Canadian National railways, a gentleman who is also a director of the Canadian Locomotive Company, Limited.
The same principle is in issue when we find that Mr. Robert Hobson is president of the Steel Company of Canada, Limited. If the National Railways should consider it advisable on part of their line to adopt oil-burning locomotives, Mr. Hobson is also a director of the North Star Oil and Refining Company.
Sir Hormisdas Laporte, if the railway supplies its own dining cars, in those parts of the country which are not bone-dry, with light beer to drink, may supply beer of the Frontenac Breweries, Limited, for all I know. I do not know whether he does or not.


Lawrence Geoffrey Power: He does.


Andrew Ross McMaster: My hon. friend says that he does. I am quite innocent of the information myself. As regards a request for cars, if the railway management want cars, they can, without going outside of the circle of directors, obtain cars from the Eastern Car Company, Limited, of which their director, Col. Thomas Cantley,
102i
is also a director. If they need paint to paint the cars, Brandram-Hennderson, Limited, will no doubt be willing to supply them. If they need coal the Nova Scotia Steel and Coal Company, of which Colonel Thomas Cantley is also a director, will no doubt be prepared to sell to them. As far as Mr. Barnhill's connection with the railway is concerned, I do not know that any companies with which he is connected would be in a position to sell to the Canadian National Railways, because they seem to be mostly publishing companies and land companies. As far as Mr. Wood is concerned, he is a director in such a number of companies that it would appear to be impossible for him to give any real care and attention to the work of the Canadian National Railway system. Now under these conditions is it fair that we should have any limited right of investigation? If Mr. Hobson, Colonel Cantley, and the other gentlemen whose names I have mentioned are high-minded gentlemen, and I have no reason to believe them otherwise, will they not gladly embrace the opportunity to come before this committee and to show that in their administration of the Canadian National Railways they have always considered, first, the interests of the railway, and secondly, the interests of the companies of which they are directors. But I pay that a far better system would be the system which I have urged, without success, I am sorry to say, in this House before, to keep out not only from the Government these interlocking directorates, as I unsuccessfully attempted to do, but also from a department of Government such as this Canadian National Railways' directorate is. I fully appreciated, I trust, as a law student when I sat at the feet of the Minister of Justice, that old French law phrase "Donner et retiner ne vaut," which I might express in homely English as "To give and to withhold at the same time is not worth a continental."
We have had promises of large rights of investigation, but these have been whittled down and whittled down and shaved down by the Prime Minister until, as stated by him, and as commented upon by the Minister of Justice, we find that the committee which the Government are now willing to give is a committee to look into the question of what information should be given by the railways to such a committee, secondly, can such information be given, thirdly, what is the best method of giving this information, what is the best method of

auditing, and for the investigation of what matters should the committee be appointed?
If a committee is to be appointed, and I frankly admit that there are certain advantages in the appointment of a committee, for a committee with the right to call witnesses and for papers could bring before it Mr. Hanna, Mr. E. R. Wood, and Colonel Cantley, in a way in which this House sitting in Committee of the Whole could not do, I say that nothing short of the fullest investigation will satisfy the members of this House who sit to your left, Mr. Speaker, and what is of a great deal more importance, will not satisfy the Canadian people whose money is being spent, and who are being heavily taxed. It must be a somewhat galling reflection to men in this country who are paying their income tax to remember that practically the whole, if not the whole, of what we raised for the year 1920 by the income tax will be absorbed by the deficit on the National Railways. We have adopted the system of public ownership, and we must give it a fair chance. Whether we wished to adopt it or not, the system has been adopted, and you cannot give public ownership in this country a fair chance unless the representatives of the people have access to full and complete information about all the operations under public ownership. You cannot give it a fair chance by leaving the control of your railway in the hands of men who have private interests which are not identical with the interests of the railway they are supposed to control and operate, and what we have to do in this House, and what the Liberal party will have to do in this country, is to create a public opnion which will say: We will get the best men that we can for this purpose, and we will see to it that they have no other interests to concern them except the public interest in regard to the railways of this country.


Mr. W. F. COCKSHUTT (Brantford):: 
Alexander Kenneth Maclean: I did not say that at all.


William Foster Cockshutt: That is the way I got your words.


Alexander Kenneth Maclean: Nor did I say the committee was going to run the railways.


William Foster Cockshutt: You did not say it was going to run the railways, but you did say that in the selection of the committee, if I remember rightly, and I do not want to misinterpret you,-in any event, Hansard will show exactly what was said -provincial lines should be watched. In other words, I understood the hon. gentleman to say: "Don't pick out men in this House who, you may think, can investigate the railways satisfactorily, but see that every province in the Dominion of Canada gets some representation on that committee whether they are fitted for the job or not." That, at any rate, is the interpretation I place on the hon. gentleman's remarks, and it is far from my wish to misrepresent him. The hon. gentleman wants a lot of information brought out. Well, so far as I see, there is no objection to information being given. The Minister of Finance (Sir Henry Drayton), has told us that he stands up for the handing out of a large amount of information. But if my memory serves me rightly, in the old days, when my hon. friend sat on the other side of the House, as he is doing now, all matters of this kind were sent to the Public Accounts Committee; but when they got to that committee something happened. There was there what was known as the "blocking brigade"; some three or four self-constituted blockers saw to it that the information sought at that time by our side, who were in opposition, was not forthcoming. I think my hon. friend will recognize the term I have just used, and perhaps he knows some of the men who constituted that committee.


Mr. COPP:: Give their names to the
House.


William Foster Cockshutt: That is not necessary.


Arthur Bliss Copp: You had better give the
names.


William Foster Cockshutt: I do not think the hon. member for Halifax (Mr. Maclean) wants them.


Arthur Bliss Copp: Well, then you might give them to me.


William Foster Cockshutt: I was addressing
my remarks more particularly to the hon. member for Halifax who says that he wants all kinds of information.


Arthur Bliss Copp: I think it would be well
for you to give the names.


William Foster Cockshutt: It is not necessary; the men are well recognized, and they were well known to every one in the House at the time.


Arthur Bliss Copp: I was not here then and I should be glad to hear the names.


William Foster Cockshutt: You did not get into the House in time, but. you had a man representing you here that could speak longer and with more volubility on branch lines than the hon. gentleman himself. I have known him to speak for five hours on the question of branch lines, so what would you do if he attempted to deal with main lines?


Arthur Bliss Copp: Did he not deal with main lines successfully?


William Foster Cockshutt: No, he did not deal with main lines, but branch lines. That gentleman, Mr. Emmerson, used to have a field day every year on branch lines, and certainly he branched out in great shape. Now, my hon. friend from Halifax, who is undertaking to solve this question, apparently thinks that it is possible for this House to constitute a committee that could receive information that could not well be handed to the House. If the committee is not able to do that, I cannot see what particular function it will have. It is perhaps well, as the hon. member for Shelburne and Queen's (Mr. Fielding), has said that every dollar of expenditure should be investigated. I am not sure that that is not a sound business principle, and if it were possible it might be done even with regard to railways. But if that information is to be sought in order to feather arrows to be shot at political archery competitions, I do not think it would be wise. If that information is to be got. in order to help us out of a difficult problem and make non-paying railways a paying enterprise, then by all means it should be granted. But I was considerably nettled to-night to hear the leader of the Opposition calling in such indignant tones for information, information, information!
Let me recall to my hon. friend's mind for a moment what occurred when these

troubles were initiated. By whom were they started? Why are we in this country staggering like weary Titans under this burden? It is because my hon. friend and the hon. gentleman who led him at that time were in a government that launched railway schemes upon the country fifty years in advance of their time. They were told that hundreds of times in the House; they were told that information had not been obtained to warrant this country in building a transcontinental road. What was the reply of the hon. gentleman's leader at that time? "We have mountains of information." Well, what did those mountains of information lead to? They led to the building of what has proved to be the greatest white elephant in the way of railways ever seen in this world. It was known that it would be so, because this railway was projected for purely political purposes, and was never intended as a business proposition, from the time of its inception. It was launched as a political railway for the expenditure of vast sums of money in this country, money which, I say, was wrongfully diverted from the coffers of the country; and if there is any gentleman who should be gentle, and willing to show a little charity and a little confidence in those who are trying to undo this tangle, it is the hon. gentleman who leads the Opposition and who, with his leader in the government of that time, shouldered on to the country vast expenditures not only on the Transcontinental, but on the Canadian Northern. When they put on that $35,000,000 of guarantee on the line traversing the north shore of lake Superior, they placed a heavy burden on the Dominion. And when they undertook to build the Grand Trunk Pacific, it was understood in the first place that it would cost $13,000,000, or at the utmost $60,000,000, and it actually cost $180,000,000. That was the second clamp they put upon the country. Now my hon. friend wants information. Well, I hope he is going to make better use of it than he and his friends did in the years 1903 and 1904, when they got mountains of information and built a railway of 1,800 miles in the wilderness that cannot be made to pay in our time by any board of directors, whether politically appointed or composed of the best business men you can get in this country.
I say we have 1,800 miles of railroad that cannot be made to pay, and it can easily be proved that no body of directors could make that piece of road pay. My hon. friend who leads the Agrarian party (Mr. Crerar) it 
is true, has a receipt all his own for making the national railways pay. I am sorry he is not here to-night to state it, but I have seen it several times in print, and it is worth while recalling to the House just what the hon. gentleman's proposition is. His proposition for making these roads pay is to recapitalize them. They have cost about one thousand million dollars up to date, but they are losing $70,000,000 on operation. Gan any man in the Agrarian party or in any other party in this House, say how these railways are to be made to meet operating expenses by reduction in the capitalization? It cannot be done; and it is childish to suggest it. Whether you capitalize them at one thousand millions, or at one dollar, if they are running at a loss on operating expenses, recapitalization will do absolutely no good, and no one can seriously suggest such a thing. Now, what the country wants to know is what we hs thinking men, are going to do to solve a very difficult and dangerous financial problem, and that is what I want to lend my attention to for a moment. In this respect I am somewhat inclined to agree for once with my hon. friend from Brome (Mr. MeMaster). The hon. gentleman is not often right, and possibly he may be wrong now; but I really feel tempted to agree with him in this respect.


An hon. MEMBER:: Do not do it.


William Foster Cockshutt: He says that the
director of a big enterprise controlling some thousand million dollars of the people's money should be prepared to spend all his time, if necessary, in the public interest, in directing the expenditure of that money; and that is but reasonable. The board might be reduced to one-half, and should be comprised of the very best men that could be obtained. I would say that from the general manager down the best men possible should be secured. The general manager should have around him the most efficient staff that money could secure, and they should devote themselves soul and body to the problem of bringing this country out of the darknes and distress in which it is in connection with its railways. To that end, I believe that the policy which my hon. friend has stated with regard to the directorate might very well receive the consideration of the Minister of Railways. I do not want to criticise anything that has been done. It is easy to criticise when a difficult mess of this kind takes place, but I fear myself that the best results have not been obtained from the operation of these

roads. If I were assured of the absolute necessity for it, I would willingly vote another $70,000,000 or more. The Government know the inward operations far better than I do, who sit on the outside and am acquainted with very little that is going on within, but they should consider very carefully indeed whether the Department of Railways and the management of the great railways now known as the Canadian National Railway system, are bringing the best results to the people of Canada which we can reasonably expect. If they are I say support them loyally, endorse heartily everything they do with a view to getting us out of the difficulties we are in. But Mr. Speaker, in order to make these railways pay we have, in my opinion, to have a different spirit not only in this House but amongst the people of the country as well-that is a spirit of loyalty to our own property. By constantly knocking our own property we are not going to build it up. We ought rather to try and boost it, and make helpful suggestions all along the line; we ought to encourage it in the way of traffic, in the way of passengers, and in every possible way that we can. Let us be loyal to our own property and see to it that the best results are obtained from this railway system.
If the committee be appointed, I hope, in order that it may serve a useful purpose, the Prime Minister will make it as wide in its scope as it is possible for it to be, and I believe he will. Because I think it is reasonable-at least as long as deficits occur-to think that the House will want to know what particular expenditures have gone to make up those deficits. I do think that is a proposition that ought to be carefully considered. If the Government were bringing down a seventy million surplus to us each year we might not ask them quite where they got it all; but if they come down with a seventy million odd deficit and ask us to vote the money then I do think that we, as custodians of the public funds should know whether that money is being wisely expended. And if this committee is appointed I think it will act reasonably; it will not unduly harass any department by asking for unnecessary returns, and it will not expect to get information that is going to result in any damage to these roads and that should not be given out. Every one that is a member of a private company knows that there is a very small amount of the expenditure laid before the annual meeting. Even as regards expenditure in lump sums, the company do not tell where
they bought the supplies, or how much they paid for them. That is not the rule. That is the experience in the case of private companies and I am a member of quite a lot of them. I do not know any company which gives that information; and in the case of this great system we ought not to ask for unreasonable information. I do not believe that members if they want to do what is right and want to assist the country out of the deep difficulty in which it is at present, will harass in any way the administration of this great national enterprise. I hope it will be successful, because I think the success of Canada is largely bound up in it. There is nothing at the present time that gives this country more concern than its railway problem and its shipping problem. We are glad to know that our mercantile marine is paying its way and has a surplus even if it is only a small one and we hope the Government railways will soon be in the same position. So far as I am concerned I heartily desire to co-operate in every possible way in making our great national highway the success it ought to be.
Mr. FRANK S. CAHILL (Pontiac): I wish to say a few words on this all important subject of the Canadian National railways. I was much interested in the remarks which fell from the Minister of Finance when he was discussing the question of parliamentary control. It seems to me that until we solve the problem of getting the members of Parliament and the people of the country educated up to what parliamentary control and public management mean, we are going to be in difficulties as regards our railway problem. There are a great many members of the House who are keenly interested in public ownership and are strongly in favour of it, but apparently have given no thought whatever to the question of public management. I remember very well that in 1918 when this subject was under discussion in the House the Government were quoting whole pages from a certain railway report, of which the Minister of Finance was partly the author to suit their own purpose, and leaving other pages, that did not suit their designs, untouched. In the case of the minister particularly interested in the subject, I was convinced that he had not quite arrived at a sound conclusion as to what might or might not be government control, even after the amount of attention he had given to it. Now, to any man who has given any thought to the subject it goes

without saying that it is impossible to get away from parliamentary control. By the very nature of our governmental institutions it is impossible to ignore, parliamentary control unless you wish to hand the entire supervision of this enterprise over to irresponsible people-that is irresponsible as far as Parliament is concerned-and have no control whatever. You must have one thing or the other; you must have parliamentary control or no control. It is this choice that is confusing the people today. Which are we going to have? Are we to have no control or parliamentary control? Any company of gentlemen who are handling $300,000,000 of the peoples' money should be subject to some control- there should be some control over gentlemen who are handling that much public money. The Estimates provide for $165,000,000, and the railway system earns $125,000,000, making roughly an expenditure of $290,000,000 without allowing for any Supplementary Estimates. The gentlemen who have the control of our railways are, according to the Government, spending this money without restriction to the extent of $300,000,000. The people have come to realize that they have to deal with a serious problem; they have come to realize that first of all the Government and Parliament must take notice of this expenditure. They want to know what is the cause of the deficits. They want to know how these deficits can be eliminated, and the Government raiway system made to earn interest on the investment if possible. The Minister of Finance said this evening that you could not have members of Parliament asking about a station agent some place; but he will not say to me now that it is not legitimate for me to ask the Government why Parliament, through the irresponsible agency referred to, should expend millions of dollars on terminals at Halifax when these expenditures have never been approved by Parliament. The Government came down here and asked for a lump sum to take care of deficits. During the year they were engaged in spending $125,000,000 in any way they pleased, and I am of opinion they are spending a good part of it under the direction of the Minister of Railways. I do not believe that the Board of Management went to Halifax and entered upon an expenditure of several millions of dollars on that undertaking without first consulting the Minister of Railways. I believe that he was advised by the Minister of Railways and Canals.


Hon. Mr. REID:: Might I ask the hon. gentleman what expenditures re refers to?


Frank S. Cahill: The expenditure referred to in the report of the Department of Railways and Canals.


John Dowsley Reid: I might answer the hon. member in regard to that. Any expenditure on capital account I gave details of when the Estimates were going through, as to how and where it was to be expended. In so far as operating expenses are concerned, of course, they do not come before us.


Frank S. Cahill: I am not at all convinced that the minister would mind if I were to refuse to ask any more questions when his Estimates are before the committee, but if he will point out any place in his Estimates in previous years where he mentioned an investment on the Halifax terminals, I believe I would be almost willing to agree not to ask him any more questions on the subject of railways. I would do him that favour. That is one question, the question of contractors who are doubletracking and doing other work in connection with the railways, that comes under capital expenditure; there is no provision made for that in the Estimates except in lump sums such as the minister passed last year at half past two in the morning after delivering a number of speeches all day without giving any information whatever.
Now, the Government may say that it is up to the Opposition to ask for and get information. I think they are justified in saying that, for in my opinion it is the business of the Opposition to get information. But the Government have taken a great proportion of the expenditure of this country entirely out of parliamentary control. The Government come down here with a lump sum for deficits, and they give as little information as possible, and the money voted is spent in any way that the management may see fit, always bearing in mind that it has to co-operate with the Minister of Railways and Canals and his colleagues.
The minister came down and asked the members of this House for suggestions. We are willing to offer suggestions, we are willing to help solve the problem if that is possible; but before attempting to do that the minister will agree with me that the Government must lay their cards on the table, they must be fair to the people and not attempt to do what the Prime Minister has attempted to do to-day. The Prime Min-

ister agreed as a final result of all this discussion, after promising for several days what he was going to do, to appoint a committee. The function of that committee would be to recommend to itself what it should recommend to Parliament, and what Parliament should in turn recommend back to the committee. That in plain language is what the minister said, that this committee would have absolutely no function at all. But if I am not mistaken the Minister of Marine and Fisheries intends to come down to-night to ask the committee to pass Estimates for a department so closely related to the Department of Railways and :Canals that it is not going to give us any information. His department, too, is excluded from furnishing any information pertaining to its expenditure. My hon. friend has been taught some bad lessons by the Minister of Railways and Canals.
The Government should make up their minds as to what they are going to do about this question. It is all very well to ask the Opposition for constructive criticism, but, as I pointed out to the minister last year, we would be very foolish to offer suggestions to a Government that would bungle them. The Prime Minister laughs, but he knows that there never was a Government of this country better able to bungle things. He will not disagree with that surely. This Government has lost more money on railways in the last five years, including this year's deficit, than the total expenditure by all the governments of Canada since Confederation, including the cost of the Intercolonial, the Transcontinental and the Hudson Bay railways. The loss to-day amounts to about $200,000 per day, and my hon. friend's remedy is to appoint a committee to investigate and see what they can do. That is not a solution for the country. The Government must first make up their minds what they are going to do as to furnishing information, about how much they propose to give and how they propose to give it. It is useless to say, "We are going to shift this responsibility on to a committee,"-a committee that will have no responsibility to any person and will merely report. The Government must take responsibility, and if they refuse to give information here, that is for them to answer before the country. But to say that they can appoint a committee to manage our railways, and then to refuse to give the report of that committee to Parliament, is too absurd for the people of Canada to accept. My hon. friend tried to make out that they are
afraid of political control. I will give them a way that will relieve them of a great deal of political control. Bring the whole proposition before the people's representatives, they who vote the money for the enterprise, give it the widest publicity possible, and then you will have no political patronage. If every person is acquainted with what is going on you will have nothing to conceal. Apparently the Government now feel they have something which they must keep back, and the people feel the same way. The Government have given them the lead and the people believe the Government-in this case; in most cases they do not.
The only plan to get away from political patronage is to give the widest possible publicity. Give the Opposition the facts and the information, and you are always protected. If you give the public full information the public may then be able to assist you to obtain better results. If the Government continue muddling along as the Minister of Railways does, the railway deficits in future will be very much greater than they have been. It is too serious a problem for the Government to treat so lightly by appointing a committee that they say will do something. It is for the Government to give information, and the time and place to give it is here and now.


Some hon. MEMBERS:: Question.


Mr. SPEAKER:: Is it the pleasure of the House that the hon. member should have leave to withdraw his amendment?


Some hon. MEMBERS:: Carried.


Edgar Nelson Rhodes: Is it the pleasure of the House to adopt the motion?


Arthur Meighen: Mr. Speaker, have I
a right to reply on the main motion?


Edgar Nelson Rhodes: I think not.


Arthur Meighen: Then I will ask leave of the House later.


Edgar Nelson Rhodes: Is it the pleasure of the House to adopt the motion?


William Lyon Mackenzie King: What is the motion ?


Edgar Nelson Rhodes: That I do now leave the Chair for the House to go into Cuin-mittee of Supply.
/


[Stage Direction]
Motion agreed to, and the House went into Committee of Supply, Mr. Boivin in the Chair.
Civil Government-Marine and Fisheries- salaries, $360,810 ; contingencies, $68,870.
['That I do now leave the Chair for the House to go into Cuin-mittee of Supply.\n/']
William Lyon Mackenzie King: May I ask my right hon. friend if it is his wish to sit all night?


Arthur Meighen: No, not by any means. I do not wish to complain of the amount of time taken up in the discussion of railway matters, but I take this occasion to seek to impress on the committee the fact that this is the fifth day of April; that Supply has been called every day for several weeks, and that virtually no real business has been done. But on account of the railway question, being up to-day, I do not think that I should ask the committee to sit longer to-night.	*


Charles Colquhoun Ballantyne: In view of the lateness of the hour, then, I beg to move that the committee rise, report progress and ask leave to sit again.
Progress reported.
is appointed. I say this merely by way of explanation of the motion of which I am giving notice. I give notice that I will move-the motion will appear in the Votes and Proceedings to-morrow:



[Stage Direction]
A message from His Excellency the Governor General transmitting Supplementary Estimates for the year ending March 31, 1922, was presented by Sir Henry Drayton (Minister of Finance), read by Mr. Speaker to the House, and referred to the Committee of Supply.
That a Select Standing Committee on National Railways and Shipping he appointed for the present Session, and be instructed to inquire into the following questions :-
(1)	What information as to operation of Canadian National Railways and Shipping as conducted by the Board of Directors and Management should, in. the public interest, be brought down in Parliament on Question, Motion for production of papers, or otherwise,
(2)	When, by what method, and under what conditions, if any, should such information be given, regard being had for the necessity of securing to Parliament and the Public all facts requisite for the determination of policy (including finance), and to the Board of Directors the best possible conditions and efficiency of management,
(3)	What system of auditing should be ^"adopted, and what extent of detail should be
given i.n the Annual Report,
(4)	Whether and for what purposes the said Committee should be continued, and that for the above purposes and for such other purposes as the Committee deem in the public interest there be referred to said Committee the Annual Report of the Board of Directors and that the said Committee have power to examine witnesses under oath to send for papers, persons, and records, and to report from time to time.
I am sorry to destroy the hopes of hon. gentlemen opposite.

Arthur Meighen: During the course of the discussion with regard to the Canadian National Railways, I promised that I would give notice to-night of a motion for the appointment of a committee. I am prepared to hand the motion in, in the regular way, but as in that case hon. members would have no chance to peruse it, I think it would be fairer, that I should read it to-night. In that connection I wish to say that the subjects here outlined are not given finally and conclusively as the subject to be under the review of the committee. In the course of my remarks, indeed, I said that such was not the case; necessarily the committee, in examining anything, Will examine it with a view to determining its duties as committed to it. As regards the report that was referred to, it was on the table for many months and could have been referred to the appropriate committee at any time had anyone so asked. There is no objection to its being referred to this committee for all the purposes for which the committee


An hon. MEMBER:: What hopes?


Arthur Meighen: The hopes that they built all their speeches on to-night, namely, that they would be denied the examination of the report.	.
On the motion of Right Hon. Mr. Meighen for the adjournment of the House:


William Lyon Mackenzie King: What business will be taken up to-morrow?


Arthur Meighen: The House will be moved into Committee of Supply on Labour and Railway Estimates; those are what we will take up first. There may be two or three Government orders that would be gone on with first, but not such as would likely be contentious. Notice was given today of a motion for interim supply, which, if the notice is sufficient will be gone on with.


William Lyon Mackenzie King: When was
that notice given?


Henry Lumley Drayton: This afternoon, I think.


William Lyon Mackenzie King: I am not aware of it.


Arthur Meighen: It would simply be handed in, I suppose.


William Lyon Mackenzie King: My right
hon. friend speaks of going on with the Estimates of the Railway Department tomorrow. Possibly the motion of which he has just given notice had better be disposed of before we go on with the Railway Estimates. We would like to know before we discuss those Estimates what information we are likely to get from this committee when it functions.


Arthur Meighen: I do not see the connection at the moment. However, I promised the hon. member for Quebec East (Mr. Lapointe) that he would have an opportunity to-morrow to make some remarks-I do not know whether or not he has an amendment-in relation to labour matters; so I have on that account mentioned labour, and doubtless he will take advantage of the opportunity.


[Stage Direction]
Motion agreed to, and -the House adjourned at 12.50 a.m. Wednesday.
Wednesday, April 6, 1921.